Senate majority eyes October target for gas line session

  • By Becky Bohrer
  • Monday, February 2, 2015 10:57pm
  • News

JUNEAU — Members of the Alaska Senate’s Republican-led majority on Monday said they are targeting October for a special session on issues related to the liquefied natural gas project that the state is pursuing.

No special session, however, has been called.

Deputy Natural Resources Commissioner Marty Rutherford said the state is “fully engaged” in negotiations on commercial agreements with the project participants and making every effort to maintain timelines. But she said negotiations can only occur as quickly as all parties come to agreement and that it is premature to predict when all project-enabling contracts will be ready for legislative approval.

“In order for this Administration to make the historic decisions and recommendations associated with royalties, equity interest, and fiscal terms, the State’s interests must be protected and the risks quantified,” she said by email. “Therefore ensuring the correct commercial agreements are in place is critical to making informed decisions.”

The Senate majority press secretary said setting a target date now, roughly two weeks into the scheduled 90-day legislative session, is meant to serve as a reminder of issues that need to be resolved to keep the project moving forward. Much of the focus of this session so far has been on the state’s projected multibillion-dollar budget deficit and frustration with the federal government after a proposal to designate much of the Arctic National Wildlife Refuge, including its potentially oil-rich coastal plain, as wilderness.

Gov. Bill Walker has said he will not start over on the gas project and will continue the work started during the prior administration. In a statement Monday, he said his administration looks forward to working with the Legislature to do “whatever is necessary” to advance the gas line.

Some lawmakers remain uncertain about Walker’s plans. As a candidate last year, he raised concerns with the structure of the project being pursued by the state, BP, ConocoPhillips, Exxon Mobil Corp., TransCanada Corp. and the Alaska Gasline Development Corp.

“It frustrates me, because I still don’t know that we’re seeing all his cards on that,” Senate President Kevin Meyer, R-Anchorage, said last week when talking about the gas issue.

Sen. Cathy Giessel, R-Anchorage, and chairwoman of the Senate Resources Committee, said pieces that need to be in place during this session to help keep the project on track include legislation on property tax valuation of the pipeline and addressing right-of-way issues through Denali State Park. There also needs to be a determination on royalty issues, she said.

Rutherford said the administration is doing its due diligence on a right-of-way bill.

An advisory group established last year that includes local government representatives has been tasked with making recommendations surrounding property taxes and ways to mitigate the financial effects to communities affected by the project.

Dona Keppers, a deputy Revenue Department commissioner, said the question of what, if any, legislation is required and what changes to oil and gas property tax laws might be required to enable the project to go ahead is complex.

“Good progress has been made in this matter but discussions are ongoing,” Keppers said in an email. “Any proposal that requires legislative approval will be submitted to the legislature in a timely fashion, consistent with the overall project timeline.”

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