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Mayors back all-Alaska gas pipeline

Oil company official says Canada route will transport more gas

Posted: Wednesday, August 24, 2005

An Alaska mayors' group has approved a resolution saying it would prefer that the state build an Alaska-only natural gas pipeline that would run from the North Slope to a liquefaction plant in Valdez for shipping to Asia and the West Coast.

The state's other option is to transport the gas through a joint Alaska-Canada pipeline to the Midwest.

Later this fall, the governor expects to have one or two contracts with the oil producers for the Alaska Legislature's approval. But if one of them does not include the all-Alaska route, the Alaska Council of Mayors will not support the contracts.

Some 85 mayors are members of the council, a group belonging to the Alaska Municipal League.

The council decided on the resolution at a meeting held Saturday in Skagway. Members said an all-Alaska pipeline could be built faster, bring more jobs to Alaskans and provide revenue for cities to share.

"This is the only proposal that I am aware of that does that," said Wrangell Mayor Valery McCandless. Her community's city council passed a similar resolution last year after members of the Alaska Gasline Port Authority presented the plan for an all-Alaska route.

Juneau Mayor Bruce Botelho said he did not attend the meeting or vote on the resolution.

Oil company representatives say the route through Canada would earn more money for Alaska because of its ability to transport more volume. The 52-inch pipes would carry 4.5 billion cubic feet of gas per day, said Daren Beaudo, spokesman for BP Exploration.

"We're focused on the project that we are convinced will give the most value to Alaskans," Beaudo said.

According to the Port Authority's Web site, the 800-mile pipe from the North Slope to Valdez would be up to 48 inches in diameter and could transport 4 billion cubic feet.

The costs are the same to transport the gas regardless of amount, Beaudo said.

Rep. Bruce Weyhrauch, R-Juneau, said draining the North Slope of its gas much faster is not a good idea if the point of the pipeline is to provide economic stability over several decades.

Weyhrauch said he supports the all-Alaska route for the same reasons as the mayors.

Local governments fear Alaskans would not be able to work on the Canadian portions of pipeline construction, due to Canadian labor laws that give preference to nationals over foreigners. The mayors hope construction would boost their ailing economies.

The Alaska Gasline Port Authority wants to give a portion of the taxes, royalties and other earnings collected from the pipeline to communities through a revenue-sharing program.

With the trans-Canada route, all earnings would go into the state's general fund, which requires the Legislature's approval to designate money for municipal revenue sharing.

Matanuska-Susitna Borough Mayor Tim Anderson said Cook Inlet, one of Alaska's major sources of natural gas, will be dry by 2011, and the state may have to pay more to import gas if there is not an all-Alaska pipeline or a spur serving Alaska.

"Alaska's gas belongs to the people and we deserve to benefit from it," Anderson said.

Details of the negotiations are confidential. Alaska House Minority Leader Ethan Berkowitz, D-Anchorage, and several mayors said the Murkowski administration is not giving fair consideration to the all-Alaska route.

"I don't see them putting much effort in that direction," he said.

The governor's spokeswoman, Becky Hultberg, said the negotiating teams are reviewing all proposals.

Hultberg also said it was premature for the mayors to prefer one route over the other without looking at both contracts first.

"We encourage people to keep an open mind as we move forward," Hultberg said.

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



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