MidAmerican's president blasts governor's comments

Posted: Sunday, March 28, 2004

ANCHORAGE - The president of MidAmerican Energy Holdings Co. said Friday there's no chance his company would return to the table to negotiate a natural gas pipeline with Gov. Frank Murkowski.

David Sokol, the company's president, sharply criticized a Friday afternoon press conference the governor held that blamed MidAmerican for the failed negotiations. Sokol claimed that Murkowski's comments to the press were "enormously distortive of reality" and further repulsed the company.

"Based on the performance of the governor and his staff today, we would have no interest in re-entering the project," Sokol said Friday.

MidAmerican's Juneau lobbyist, Ashley Reed, arranged for Sokol to call reporters after Murkowski's press conference and give his reaction to it. The conference call took place in the office of Rep. Ethan Berkowitz, D-Anchorage, who is also critical of the governor's handling of the negotiations.

Murkowski had said at the press conference that the company demanded exclusive development rights for a gas pipeline from the North Slope and it would have been irresponsible for the state to accept.

"It's got to be good for the state of Alaska," he said. "It's got to stand the light of day."

On Thursday, MidAmerican announced that it was pulling out of its gas pipeline negotiations with Murkowski administration officials. The Iowa company, owned in part by billionaire investor Warren Buffett's Berkshire Hathaway Inc., had been negotiating with the state since January over its proposal to build a 745-mile gas pipeline from the North Slope by 2010.

The deal broke down over the company's demand for exclusive rights for five years to pursue development of the gas pipeline. During those years the state could not negotiate with any other potential developer.

Murkowski told reporters at the press conference that was unacceptable.

"I have to do what I think is in the best interest of all Alaskans in evaluating this business proposition," the governor said. "For me arbitrarily to go out and negotiate a binding contract for five years ... is something I would be derelict in proposing."

MidAmerican could just walk away after five years, Murkowski said, leaving the state right back at the starting line on its effort to make the project happen.

Murkowski said the exclusive contract would force the state to drop for five years its gas pipeline negotiations with others interested in perhaps building a pipeline. The three major North Slope gas producers, BP (Exploration) Alaska, ExxonMobil and Conoco Phillips, are negotiating with the state. A consortium made up of the Fairbanks and Valdez municipalities also wants to negotiate. And the governor said he's expecting to get another application soon from a "major pipeline company."

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