Field trip: Wagoner: State, D.C., on line with gas pipeline

Posted: Thursday, March 11, 2010

Alaska's energy policies and goals are in line with those of the Lower 48 according to Kenai's voice in the state Senate.

Sen. Tom Wagoner, R-Kenai, was largely positive on Tuesday about the dialogue at an energy conference held in Washington, D.C., late last week.

Wagoner was the only member of the Kenai Peninsula delegation to attend the conference, which was hosted by The Energy Council, an organization made up by energy companies, lawmakers from energy producing states, Canadian provinces and Venezuela.

Wagoner, who returned with other Alaska lawmakers on Monday, said that based on what he heard from federal energy officials, he believes the state's energy plans and policies are on track.

He cautioned, however, that he has heard federal agencies and administrations say one thing in the past only to change their tune at a later time.

"Things can change and your best guess is as good as mine," he said.

Wagoner said he was perhaps most pleased by comments given by the Deputy Assistant Secretary of Oil and Natural Gas for the Department of Energy, Christopher Smith, in regard to a pipeline project that would deliver North Slope natural gas to domestic markets.

"Guess what, one of their top priorities is still the gas line," Wagoner said of President Barrack Obama's administration. "It's just a matter of when the time is right. It has to be a project that's feasible and profitable or it won't be built."

Wagoner said he thinks more will be known about the future viability of a transcontinental pipeline after the conclusion of open season this summer, but remains an ardent supporter.

He argued that a big project would make it more affordable to provide Southcentral with natural gas via a spur line rather than an alternately proposed direct bullet line.

"The best way to deliver gas to Southcentral is with a big pipe," he said. "The bigger the pipe the smaller the tariff, in other words, transportation costs."

He dismissed concerns that were raised at the conference about the growing availability of shale gas in the Lower 48 as a potential competitor to the Alaska mega project.

House Majority Leader Kyle Johansen, R-Ketchikan, warned about the potential impact that shale gas development could have on a gas line in an Associated Press story on Tuesday.

Senate President Gary Stevens, R-Kodiak, who represents the southern Peninsula, did not attend this year, but said in speaking with his colleagues he had also heard of concerns about shale gas.

"It looks like they can produce a lot of shale gas inexpensively," Stevens said. "That's going to be a bit of a problem because we have to build a pipeline that costs $41 billion just to get it (the natural gas) there."

Wagoner said he thought the state should hold off before making any hasty decisions though.

"I just think we have some people in the Legislature and in the press that have their own agenda," Wagoner said. "I think it's best to wait for these two open seasons with TransCanada and Denali. We're jumping the gun if we don't wait and watch this scenario play out to the end."

Wagoner said he was also pleased to hear comments from Jonathan Silver, the executive director of the DOE's loan program office, who spoke about the availability of federal funds for dam construction.

"He's got a loan account of about $100 billion," Wagoner said. "I'm going to see what we can get started on at Chakachamna, if anything, but it's something to look at anyway."

Wagoner said he supports the idea of constructing a 330-megawatt hydro project on the Chakachamna River on the west side of Cook Inlet. He's less supportive of a large scale hydro project on the Susitna River.

"I'd heard that hydro was off the table at the federal level but Silver said that's not so," he said.

Wagoner was concerned by the dialogue at the conference on climate change and the potential for federal regulation of carbon dioxide emissions.

"Nobody has proven that human generated CO2 is causing climate change," Wagoner said. "This isn't something new, we've had warming trends and cooling trends. We have them all the time. Maybe CO2 is having some effect but I'm not sure how much."

Based on conversations he's had with his colleagues, House Speaker Mike Chenault, R-Nikiski, said he thought Alaska's voice was heard clearly there.

One of note was on the designation of much of Cook Inlet as critical habitat for the Cook Inlet Beluga whale through the Endangered Species Act.

"We want to make sure they have scientific data to back up any decision they have to make," he said.

Chenault said he wasn't sure what impact a listing might have but was concerned it could disrupt shipping as well as oil and gas exploration and development.

"At the least it will take more time for permitting and other processing, and that causes concern," he said. "If you delay a project long enough, you can kill it."

Dante Petri can be reached at

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