Oil companies have enough incentive for gas pipeline

Murkowski suggests patience and persistence to resolve ANWR gridlock

Posted: Thursday, December 11, 2003

Major oil companies have all the federal incentive needed to construct a North Slope natural gas pipeline should Congress pass the energy bill, Sen. Lisa Murkowski said Wednesday.

The bill doesn't contain tax credits guaranteeing a minimum price for the volatile commodity, but an $18 billion federal loan guarantee and other incentives make it a generous offer, she said.

"In terms of what they indicated to us they need, we've done that at the federal level," Murkowski said. "At the end of the day, we need to do what we need to do to get a gas line through."

During a stop in Anchorage, Murkowski spoke with The Associated Press about her first year in the U.S. Senate.

Much of it was spent on energy issues, and those lay either unresolved or dead.

The perennial push to open the Arctic National Wildlife Refuge to oil drilling again became entangled in partisan bickering.

Murkowski said she was startled to learn how deeply entrenched the two sides were on ANWR, but saw no end to the gridlock. "I'm advising patience and persistence," she said.

The congressional year also ended with two measures that could spur movement on a $20 billion gas pipeline project.

President Bush's energy bill stalled in the Senate in the final days at the hands of opponents who complained that it was a giveaway to oil and natural gas producers.

The measure includes an 80 percent federal loan guarantee of up to $18 billion for a natural gas pipeline, streamlined permitting and accelerated depreciation for producers and tax credits for a gas treatment facility.

Also left pending is a separate spending plan that contains less-generous federal loan guarantees that could apply to a pipeline carrying liquefied natural gas to the United States.

While it's not readily apparent Alaska is any closer to getting its 35 trillion cubic feet of stranded North Slope natural gas to market, watchers have seen a lot of progress this year.

"It does put the federal government on the table with at least some number that people can see," said Harold Heinze, chief executive of the Alaska Natural Gas Development Authority.

Alaska voters created the development authority by ballot initiative largely out of frustration over the major oil producers seeming inability to commit to the project.

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