Judge orders governor to release oil contract

Administration seeks clarification of ruling

Posted: Sunday, May 07, 2006

A Juneau judge ruled Friday that the governor must release the natural gas contract his administration has kept from the public eye for several months.

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But the attorney general filed a motion Saturday seeking clarifications from Superior Court Judge Larry Weeks, delaying compliance with the order, a spokesman for the Department of Law said. Details sought include when the contract should be released.

Sen. Hollis French, D-Anchorage, also a practicing lawyer, filed for an injunction late last month to obtain a copy of the contract that he plans to release to the public.

"I was thrilled to see that the judge read the law carefully, compared the secrecy provisions of the Stranded Gas Act with the openness provisions of the Public Records Act and came down on the side of openness," French said.

For the past two years, the administration has been working with a trio of major oil producers - ConocoPhillips, Exxon Mobil and BP - to agree to build a $25 billion pipeline to deliver natural gas to markets in the Lower 48.

Weeks' ruling did not include a timeline, French said.

"The ruling said the producers have to be given notice," he said. "They're all here in the building, and I don't think it should take long for that notice to take place."

Department of Law spokesman Mark Morones said there's a lot of work to be done before the administration complies.

"Obviously, this is a pretty involved process, and it involves a lot of information that would be subject to confidentiality right now," he said.

Morones said he did not know when Weeks will address the Department of Law's request.

The administration has expressed reluctance throughout the session to release the contract because it will not be complete until the Alaska Legislature passes a new oil and gas tax scheme.

Murkowski and the producers want to include the new tax laws in the contract so oil companies would know their fiscal outlook in Alaska for the next 30 years.

Lawmakers have been eager to get their hands on the contract while they try to pass a rewrite of the state's oil and gas tax system. As the proposed plan would increase taxes on the industry, the administration has said that if lawmakers raise the tax too high, producers will back out of the deal to build a pipeline.

"It gives us the opportunity to see what's been behind the curtain all these months. What is it that we are giving away in the contract that is making the producers willing to do an oil tax increase?" French said.

With the session set to end on Tuesday, legislators are rushing to pass the net-profits tax bill before the deadline.

Murkowski spokeswoman Becky Hultberg said the governor still intends to release the contract - even if the oil tax bill is not ready - on the first day of the special session that starts Wednesday.

French said the Legislature can still benefit from seeing the contract, as the bill has yet to pass the House.

"I think given the strength of this decision and the likelihood that they're not going to win on appeal, they should do the right thing and let the contract out now," he said.

• Andrew Petty can be reached at andrew.petty@juneauempire.com.

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