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In-state natural gasline gets boost

Posted: January 25, 2012 - 1:04am
Speaker of the House Mike Chenault, R-Nikiski, right, and Rep. Mike Hawker, R-Anchorage, announce House Bill 9 for an instate natural gas pipeline at the press conference at the Capitol on Tuesday.  Michael Penn/Juneau Empire
Michael Penn/Juneau Empire
Speaker of the House Mike Chenault, R-Nikiski, right, and Rep. Mike Hawker, R-Anchorage, announce House Bill 9 for an instate natural gas pipeline at the press conference at the Capitol on Tuesday.

Two top members of the House Republican leadership urged the state to drive forward with a small-diameter natural gas pipeline to Southcentral.

The plan, developed by House Speaker Mike Chenault, R-Nikiski, and Rep. Mike Hawker, R-Anchorage, will vie with other efforts to bring energy to Alaskans, including the state’s official effort at a big pipeline, the Alaska Gasline Inducement Act.

It was endorsed by the Legislature with $28 million in preliminary funding last year, and has been making good progress since then said Hawker.

“I truly believe in my heart we are closer than ever to seeing an Alaskan natural gas pipeline on the verge, on the cusp, of being constructed, a pipeline that will actually bring Alaskans’ gas to Alaskans,” Hawker said.

Chenault and allies rolled out the proposed “Alaska Stand Alone Pipeline, or ASAP, last year to bring small volumes of natural gas

Chenault said that completing the job of bringing the project to “sanction,” when the decision is made to go forward with, would cost about $400 million.

The proposal by Chenault and Hawker is an updated version of House Bill 9, and would incorporate three other bills already passed by the House that would make other changes to state law to make more likely to happen.

The ASAP is being developed by the state created Alaska Gasline Development Corporation, a subsidiary of the Alaska Housing Finance Corporation. AHFC Executive Director Dan Fauske is also serving as head of the AGDC.

The plan would abandon one previous effort, the voter-initiated Alaska Natural Gas Development Corporation. Chenault’s’ legislation will replace its board of directors with the AHFC board.

Chenault said the final decision to construct the ASAP pipeline would be left to a future Legislature, and his proposal is only to get to the decision point.

Chenault said the ASAP line would not be in competition with the larger AGIA line, but that if the large line goes forward the small line could be used to bring gas to markets from the big line.

“Let’s say AGIA does go forward… then it becomes a spur line coming off the big line,” said Dan Fauske, ASAP executive director.

Some Democrats were immediately skeptical if Chenault’s plan was the way to go.

House Minority Leader Beth Kerttula, D-Juneau, expressed skepticism about taking on one more pipeline project.

“What concerns me is, without understanding a lot more about (where) the speaker and Rep. Hawker are going, I’m not really in the mood to put a lot lot more money out there on these amorphous proposals,” she said.

The plan would bring new supplies of natural gas to Cook Inlet, but that’s something the state has already been spending money to bring about by subsidizing gas exploration in the inlet.

That effort shows initial signs of paying off, with Buccaneer Energy and Escopeta Oil both announcing big discoveries in the inlet.

Chenault said building a pipeline wouldn’t discourage more exploration, but give explorers new markets into which to sell their gas.

That might mean the line, though a terminus is not yet determined, would go to the Nikiski LNG plant.

Rep. Mike Doogan, D-Anchorage, asked why the proposed line plans to bypass Fairbanks, if part of its original purpose was to bring cheaper gas to Fairbanks.

“The problem is that Fairbanks doesn’t have energy, so why are we building a line that goes to Nikiski?” he said.

Doogan said the state should just build a gasline to Fairbanks, if that was the goal.

• Contact reporter Pat Forgey at 523-2250 or patrick.forgey@juneauempire.com.

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