Palin responds to Stevens' criticism of natural gas line
Gov. Sarah Palin is challenging U.S. Sen. Ted Stevens' criticisms of her natural gas pipeline development strategy, the Alaska Gasline Inducement Act, which was adopted by the Alaska Legislature last year.
"We're not going to change course. We're very confident we are on the right course," she said at a meeting with reporters Thursday.
In a visit to Juneau this week, Stevens, a Republican, gave his annual address to a joint session of the Legislature. Alaska's senior senator seemed to side with oil companies, such as ConocoPhillips, which have called for "certainty" in tax rates.
At a press conference Thursday, Palin said the gas line act calls for 10 years of tax stability for those committing gas to the pipeline, but that 40 or more years of tax stability sought by the companies is not acceptable.
Former Gov. Frank Murkowski had agreed to the long-term tax freeze, but the Legislature failed to approve that deal and Palin flatly rejected it.
"He may have agreed with the prior administration's term of 35 to 45 years, which we do not agree with," she said.
Palin and Stevens may be closer on the issue than the senator thinks, however. He said Tuesday he believed the state's 10-year tax freeze began immediately and would likely have expired by the time gas began flowing.
Palin said AGIA actually calls for locking in tax rates at the date gas begins to be shipped and extending 10 years after that.
In any event, TransCanada Corp., the only qualifying applicant under AGIA to build the gas pipeline, has said it doesn't need additional tax certainty, she said.
ConocoPhillips, the state's largest oil producer, has proposed its own pipeline outside the AGIA process.
Palin also said she's not concerned by Steven's comments that there was "no chance" the U.S. Congress would agree to act as a "bridge shipper" in the event Alaska's oil producers fail to commit to ship their gas in a pipeline.
"Thankfully, TransCanada is not asking for that," Palin said.
Palin said her administration asked TransCanada for suggestions on how to increase the likelihood of success, and the company suggested a role for the government as a "bridge shipper."