Dueling bills would 'railroad' a gas line
Rena Delbridge |
Feb 19, 2010
Losing faith in the administration's efforts to get natural gas to Alaskans and frustrated with the slow pace of progress on a huge pipeline to the Lower 48, two lawmakers are launching significant bills a third of the way through the legislative session that force an in-state natural gas pipeline project into the hands of the Alaska Railroad Corporation. The railroad has the authority to issue $17 billion in tax-exempt bonds, which could take the edge off the high price tag of such a line -- tentatively marked at around $4 billion. One of the bills, offered by Rep. Mike Chenault, brings another entity with bonding power into the mix -- the Alaska Natural Gas Development Authority. And the proposal by Sen. Lesil McGuire includes the Alaska Housing Finance Corporation, with its substantial bonding capacity. Alaskans have dreamed for decades of a line bringing the North Slope's rich natural gas south to in-state population centers, and on to the Lower 48 where the gas could generate cash to feed the state's treasury. Such a project has become imperative to many, as oil production slumps, a huge natural gas line straight to the Lower 48 faces uncertainties, and residents face expensive home energy costs coupled with, in some cases, possible gas shortages. But a pipeline hasn't been commercial enough to attract the attention of private investors, leaving some lawmakers saying enough is enough, and calling for stronger state action. "The take I get from the administration is their interest is in AGIA," Chenault said, referencing a $500 million contract for a massive pipeline from the North Slope to Canada. "I don't think Alaskans need to be a second priority. They need to be right up there and considered the top priority." Chenault, R-Nikiski, is lodging his considerable influence as House speaker behind a bill he plans to introduce on Monday. How far will he push it? "We'll see," he responded. "We've got to get us off dead-center," he said. "If you build a (in-state) gas pipeline, you've opened up a number of opportunities. You've got a responsible energy supply, a long-term supply, and it makes the opportunities for value-added products." The measure would create a core team, led by the railroad, along with the state's Department of Transportation, which holds valuable rights-of-way that could cut costs and permitting for a pipeline; the instate gas line team, headed by Gov. Sean Parnell's appointee Bob Swenson; and the Alaska Natural Gas Development Authority, with bonding capacity that Chenault last year filed a bill to expand. That team would have until July 1, 2011, to come up with a thorough plan to pitch to lawmakers. A broader advisory group would include financing experts, the Alaska Permanent Fund Corporation, the federal pipeline coordinator's office, native corporations and others. But McGuire, an Anchorage Republican and co-chair of the Senate's Resources Committee, got her bill in first, dropping it Friday afternoon and sending off a press release right afterward. Her bill directs the railroad to "aggressively pursue the permitting, design and financing of a bullet line." McGuire's plan gives the railroad broad authority, including pipeline construction and operation, and calls on the Alaska Housing Finance Corp. to participate. Her bill also directs the railroad to study the costs of a gas-to-liquids facility, something for which McGuire has advocated along with sen. Bill Wielechowski, D-Anchorage. Both bills expressly shift responsibility from the governor's office and Department of Natural Resources, where in-state gas efforts have been centered. Some lawmakers, including McGuire, have grown frustrated with the apparent lack of progress from that team. Leader Harry Noah resigned late last year and warned of an impending "civil war" within the state as funding and support keeps streaming out to various groups each working on gas, but with different missions. Politics would seem to be at play here. Late Friday afternoon is an off time to drop a bill, and lawmakers typically don't announce their plans before a bill is read across during a House or Senate floor session. The language of the two bills is different, but the intent is close enough to potentially raise some eyebrows.
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