Energy bill amendment allows regulation options for gas line

Posted: Friday, March 22, 2002

FAIRBANKS - Companies wanting to build a proposed trans-Alaska natural gas pipeline would get to choose one of two sets of government regulations but would not have a say in the line's route, under new amendments to a U.S. Senate energy bill.

Sen. Frank Murkowski, an Alaska Republican, proposed the amendments late Thursday afternoon, as the Senate was preparing to leave town for its two-week spring break. The Senate adopted them unanimously.

Still missing is much-discussed but little-seen language that would create some sort of tax credit for gas producers if prices fell below a certain level. But a new version of a proposed federal loan guarantee for part of the line's financing was adopted.

The amendments passed Thursday would allow companies seeking pipeline permits to apply under the terms of the 1976 Alaska Natural Gas Transportation Act or under the more recent Natural Gas Act.

Last summer, North Slope gas producers asked for legislation clarifying that the Natural Gas Act could be the controlling federal law. That was in part because the older, 1976 act designates a southern line route along the Alaska Highway, and companies wanted the freedom to consider a northern alternative that is believed to be cheaper.

Murkowski's amendment would allow either law to be used for permitting, but another amendment still mandates the southern route. It replaces an amendment of a similar nature, passed earlier this month, that was sponsored by Senate Majority Leader Tom Daschle, a South Dakota Democrat.

A House version of the energy bill, passed last August, also contains a provision blocking a northern route. Rep. Don Young, an Alaska Republican, secured that language. The Alaska Legislature has taken a similar stance.

When the Senate returns April 8, Murkowski said, he will resume efforts to create financial benefits that improve the line's economics. Senators from other gas-producing states have objected to tax credit proposals discussed to date.

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