Gas policy council meets

Posted: Friday, March 02, 2001

ANCHORAGE (AP) -- A collection of business executives, government officials, political and civic leaders met in Anchorage on Thursday to consider Gov. Tony Knowles' plans for a huge natural gas development project.

The Alaska Highway Natural Gas Policy Council is part advisory group, part political coalition and part public forum with a goal to advise the governor on the best way to build a natural gas pipeline off the North Slope to market.

''You will be a part of the public process to inform Alaskans and inform ourselves'' about the project, Knowles told the group at its first meeting.

The group has no power other than to advise the governor and, so far, has no funding from the state Legislature.

What the group does have is an ambitious agenda, breadth of experience and political heft. Among the council members: Anchorage Mayor George Wuerch, former attorney general Charlie Cole, Cook Inlet Region Inc. president Carl Marrs, former BP executive Brian Davies, National Bank of Alaska chairman Ed Rasmuson, Arctic Slope Regional Corp. president Jake Adams and former Arco Alaska Inc. president Ken Thompson.

The governor supports building a pipeline along the Alaska Highway to bring the North Slope's huge natural gas reserves to markets in the Lower 48. In addition to bringing gas to Interior communities, Knowles said, the highway route may allow a second project to ship liquefied natural gas to Asia.

The companies that own most of the North Slope gas reserves -- BP Exploration (Alaska) Inc., Exxon Mobil and Phillips -- are also considering a second pipeline route from Prudhoe Bay, offshore to Canada's Mackenzie River delta. The companies have joined for a $75 million assessment of the two routes. They expect a decision late this year.

A question over whether the governor's policy had excluded a potential route hung over the council. Given that BP, Exxon and Phillips have said that they are studying the northern route, should the council consider it?

Council member and Anchorage businessman Bob Penney said he supported the Knowles' highway route, ''but what if the companies come back and tell us the northern route is 20 percent cheaper -- what then?''

Knowles said that not only did the northern route not bring gas to Alaskans, but regulatory and technological challenges threatened delays and possibly cost overruns on the project.

''The northern route is not competitive,'' he said. The governor said if the companies want to pitch the northern route, the forum is the place to do it.

''I want them to take this body very seriously,'' Knowles said.

Members spent most of the first council meeting sorting out administrative details. The 26 members will break into six committees covering subjects such as employment, state revenue and environmental issues.

Over the next six months the council plans about eight public meetings across Alaska. The goal is to gather public input on the project. By late this year, the council will forward written recommendations to the governor's gas cabinet. The cabinet is made up commissioners of revenue, fish and game, transportation and environmental conservation.

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