Legislature Expresses Optimism About Natural Gas Pipeline

Alaskans have talked about getting natural gas off of the slope for 35 years

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By Bill McAllister
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Story Created: Jul 30, 2012 at 5:45 PM AKDT

Story Updated: Jul 30, 2012 at 6:30 PM AKDT

ANCHORAGE - Alaskans have been talking about getting natural gas off of the North Slope for 35 years.

As lawmakers checked in for an update Monday, much optimism was expressed about building a pipeline, but not all about the same project.

Some lawmakers, impatient with the process under the Alaska Gasline Inducement Act, are pushing for an in-state pipeline to serve the state's consumers, without waiting for the big project that would export gas and enhance the state treasury.

But the Parnell administration said they could be one and the same.

"I think we're closer than we ever have been. I really do," said Representative Mark Neuman (R-Big Lake), co-chair of the legislature's Joint In-State Gas Caucus, who’s bullish about a gasline specifically for Alaskans. "The progress that we are making on this is substantial in getting in-state gas pipeline, energy security for Alaskans."

And House Speaker Mike Chenault (R-Nikiski) said that's a priority now, compared to the long-held dream of producing gas for the Lower 48 or Asian markets.

"I don't about first, but I think the in-state pipeline is the one that's moving forward."

But Dan Sullivan, the state Commissioner of Natural Resources, said there's no need for separate projects.

"The key issue here is that we think clearly you can actually do both together. And that's what's in the best interest of the state."

Governor Parnell has set a deadline of September 30 for the three major North Slope producers and state gas line licensee TransCanada to come up with specifics for a project to tidewater, where the gas could be chilled to a liquid and shipped throughout the Pacific Rim.

"We have been pressing to make sure that that third-quarter deadline is met,” Sullivan said. “And certainly in your discussions with the lease-holders, if you can reinforce that message we think that that's going to be quite important."

Sullivan said that pipeline also could be the conduit for gas for Alaskans, taking advantage of economies of scale and avoiding duplicative costs.

But skepticism remains about the Alaska Gasline Inducement Act, the framework for the big project.

"I can remember the days when we were hearing that AGIA, as it was originally conceived, was going to be, quote, wildly profitable under all circumstances. And I think that's been proven to be a sad misnomer," said Representative Mike Hawker (R-Anchorage).

Everybody wants to tap the gas.

But there's no alignment yet on where to ship it.

Sullivan said if a project can be designed and agreed to by the producers, TransCanada and the state agency pursuing the in-state line, then a package of fiscal terms could be presented to the Legislature next year.

Sullivan also made clear, though, that the governor's top priority is still reducing the production tax on oil.
 

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SpiesAmoungUs said on Tuesday, Jul 31 at 8:23 PM

cough cough and certain "birthright" trusts that are invested in oil stocks can be surely to sell and return the profits to the "birthright" owner...now that was rated as a cash value factor of $108 mil in 1989 so what would that be worth now?

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