Millions on tap for pipeline training

Provision is in newly enacted military contruction measure

Posted: Monday, January 10, 2005

ANCHORAGE - The authorization of $20 million to train and hire Alaskans to build a proposed natural gas pipeline has state officials and trade organizations talking about how to spend it.

But some contend there's not enough money and it may be coming too late.

The Alaska pipeline construction training program was one of several provisions related to building a $20 billion North Slope natural gas pipeline that were included in the federal military construction bill for fiscal year 2005. The bill was signed into law Oct. 14.

Alaska for years has sought construction of a natural gas pipeline that could move an estimated 35 trillion cubic feet of gas from the North Slope through Canada to the Lower 48, with operations perhaps beginning in 2015. Exxon Mobil Corp., ConocoPhillips and BP have submitted a proposal to the state for building the pipeline, but there are still many steps that must be taken before the proposal could become a reality.

TransCanada Corp. and Enbridge Inc. also have submitted pipeline project applications with the state. The Alaska Gasline Port Authority has proposed an all-Alaska pipeline.

Congress has authorized a $20 million grant - with up to $3 million designated for building a training facility in Fairbanks - to the Alaska Workforce Investment Board for training Alaskans. The grant is authorized to be available two years prior to the expected start date of the pipeline construction.

Greg O'Claray, commissioner of the Alaska Department of Labor and Workforce Development, said $20 million is not enough money to train the number of Alaskans needed for a pipeline construction project that would meet Gov. Frank Murkowski's 90 percent Alaska-hire initiative.

O'Claray said additional funding will have to come from the natural gas producers and other private investors to train an Alaska work force that will be ready to work when the construction begins. The funding will be used to expand existing training programs and start new ones specific to the pipeline construction project, he said.

TransCanada PipeLines Ltd. estimated it would employ between 6,800 and 8,600 people at the peak of constructing the Alaska portion of its proposed pipeline, according to Tony Palmer, TransCanada's vice president of Alaska business development.

Jim Sampson, executive president of the Alaska AFL-CIO, agreed that the $20 million federal grant is not enough to train Alaskans for history's largest private construction project.

"That's a good start," he said. "It's not so much the money; it is how you spend the money."

Proper training requires time in the classroom and on the job - a process that exceeds the two-year period when the federal grant could be available to fund training, Sampson said.

The proposed training facility in Fairbanks would provide a place to train people during a typical six-week training course. Sampson said he recommends construction of a 15,000- to 16,000-square-foot facility that would include housing units for people traveling to attend the course. Such a facility would likely cost between $4 million and $5 million to build, he said.

Once people finish a training course, there should be jobs available for them to complete the federally certified apprenticeship program in their trade, Sampson said. The apprenticeship programs require three to four years of job experience, he said.

To ensure there will be enough Alaskans available to build the pipeline, Sampson said the state government must start requiring all contractors of publicly funded construction projects to hire apprentices.

Sampson also recommended the state include in its oil- and gas-lease agreements with producers a requirement to hire apprentices when operating on the leased land.

The first two-week training session was held in Fairbanks in November. One hundred people worked in teams to connect pieces of 8-inch diameter pipe.

It was the first pipeline training program to take place in Alaska in the last five years, said Mike Andrews, director of Alaska Works Partnership, which organized the session.

The state labor department is in the process of assessing the training needs before implementing recruitment and training programs, O'Claray said.

The Alaska Workforce Investment Board on Jan. 18 is scheduled to hold a construction summit to address work force demand and supply for the pipeline construction.

O'Claray said he is committed to meeting the governor's 90 percent Alaska-hire initiative in building the pipeline.

To guarantee that 90 percent of the people building the pipeline are Alaskans, O'Claray wants the agreement between the state and pipeline contractor to include a requirement of 90 percent Alaska hire that would be enforceable in court, he said.

Recruiting some 7,000 Alaskans to build the pipeline could be challenging and put a significant strain on industries already working hard to meet their existing employment needs, said Dick Cattanach, executive director of the Associated General Contractors of Alaska.

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