DRILL, baby drill. That's the unofficial motto of the great state of Alaska - as well as the famous catchcry from one-time US vice-presidential candidate Sarah Palin - which is spending money to attract mining companies to exploit its abundant natural resources.
While the Australian government lumps tax after tax on the shoulders of business, especially miners, Alaska has a scheme that rebates 65 per cent of drilling costs and 45 per cent of development costs - and that's a cash payout not dependent on success.
This has excited junior miners from around the world. That includes Australia, with Buccaneer Energy raising $13.5 million yesterday to fund further expansion of its Kenai Loop onshore gas field.
Buccaneer is producing 5.1 million cubic feet of gas a day from Kenai Loop, which it sells to the local Alaskan utility company, earning it net cash flow of $8 million to $9 million a year. The drill site is only at 10 per cent capacity so the upside is huge, delivering as much as $28 million in cash flow if all goes to plan. Yesterday's capital raising, supported by an unnamed wealthy family office in Singapore, will also support Buccaneer's offshore activities, centred on Alaska's Cook Inlet, a region in the southern part of the state and for a long time ignored by the majors.
Early studies point to potential oil reserves of 1.4 billion barrels of oil at Cook Inlet.
The fact that Alaskans are also facing an energy shortage and potential brownouts means prices are good (up to 50 per cent above other US states) and there is little grumbling among the locals when it comes to mining - but the cold weather probably also makes it uncomfortable for any greenies to protest as hemp skirts and organic Indian pants don't provide much protection from the Alaskan wind.
CSL shows street smarts
THE numbers are shocking, as are the personal stories behind each statistic. Nearly 300,000 Australians now live with dementia, and without a medical breakthrough that number is expected to soar to almost 1 million by 2050.
Alzheimer's disease is the most common form of dementia, accounting for between 50 and 70 per cent of all cases, and each week there are 1600 new cases in Australia. The statistics are similar in other Western countries, thanks to extended life spans.
This makes the search for a cure, or some kind of treatment, a vital healthcare objective and, given the cost to the community of caring for dementia patients, there are also financial and budgetary concerns.
There could be an Australian connection to the worldwide hunt for a cure. CSL, once a government department, is now a global pharmaceutical player with a market capitalisation of $20 billion and a history of getting results.
It has done the early lab work on treating Alzheimer's patients with intravenous immunoglobulin (IVIG), the backbone of CSL's multibillion-dollar international blood plasma business.
Early results are promising. CSL rival Baxter, a US company, is leading the charge and this week the primary investigator in its IVIG/Alzheimer's trial told a healthcare conference that IVIG had halted the progression of Alzheimer's for as long as three years.
Industry gossip is that although the use of IVIG for this disease is in its trial stage, at least 400 Americans have paid about $80,000 each to receive the treatment before it wins regulatory approval.
Because CSL has done early lab work on IVIG and Alzheimer's, it is believed that even if Baxter develops an approved medicine, CSL will be able to lay claim to some of the treatment and possibly carve out a massive earnings stream.
The only problem then becomes sourcing enough IVIG to treat the millions of Alzheimer's sufferers around the world. Leading analyst Andrew Goodsall from UBS believes there is not enough capacity to supply even 5 per cent of sufferers, and insurers would very likely impose limits.
Macau gamblers cool off
CHINA'S economic slowdown is now hurting the gambling enclave of Macau. Wynn Resorts reported yesterday that revenue dropped more than 7 per cent at its Macau operations for the second quarter as VIP gamblers curbed their spending.
The former Portuguese colony is disproportionately dependent on high-stakes gamblers, with up to 70 per cent of revenue coming from this source.
If Wynn's subdued performance in Macau - which caused it to miss analysts' expectations - is repeated by the other casino operators, it won't be good news for James Packer's Crown.
Crown has a significant investment in Macau and makes no secret of its dependence on Chinese high rollers for VIP revenue at its two casinos in Australia.
VIP traffic underpinned the $2.2 billion revamp of its local casinos and a recent tilt at rival Echo Entertainment, which is predicated on building a VIP-only casino in Sydney's CBD.
Ian McIlwraith is on leave.