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Alaskans should be asking lots of questions about gasline plan

Posted: Monday, May 14, 2001

The governor's unfortunately named Alaska Highway Natural Gas Policy Council will hold a public meeting Thursday evening at the Kenai Merit Inn. In classic cart-before-the horse fashion, Gov. Tony Knowles is asking Alaskans to weigh in on a world-scale North Slope gas project without providing any background information or the time to assimilate it. The average Alaskan needs some basic information before making decisions of this magnitude. And make no mistake--deciding the fate of this $200 billion asset, which all of us own, is as big as they get.

The most basic questions should be answered before the people of Alaska can render a meaningful decision. First, is our gas really available for a project? Has this question been answered? No. It hasn't even been asked.

Here are a few other questions. Do we really know how much the proposed Alaska Highway project costs? Is it engineered? Is it permitted? When could construction begin? Does it abide by the Alaska Natural Gas Transportation Act (ANGTA), a longstanding treaty with Canada? Does it provide gas to Southcentral, which will soon need replacement supplies? How much revenue does it provide to our state treasury? How many Alaskans will it employ during construction and afterwards? Surely, Alaskans need these questions answered.

Are there other options? Is the Gas Policy Council even studying the LNG option to Valdez?

The LNG project has a known price: $7.3 billion. It is permitted. It is engineered. It has signed labor agreements. It creates 13,000 jobs during construction and over 500 permanent jobs. It can serve multiple markets -- in Asia, Mexico and California (where the shortages are). It delivers gas to Southcentral via a spur from Glennallen to Sutton. Furthermore, it produces the most revenues for our state treasury, some $500 million a year according to some projections. Goodbye, state income tax.

But the most fascinating component of the Valdez project (or any All-Alaska route to tidewater, even Cook Inlet) is that the state of Alaska can own the pipeline outright, thereby adding, by some estimates, another $500 million a year to the treasury. The governor's mostly-Canadian Highway route does not allow this option.

Why is state ownership so vital to Alaskans? Because with any percentage of ownership, 10, 50 or 100 percent, Alaska has access to the books, something we lack with the trans-Alaska oil pipeline and that has cost our treasury billions. Wouldn't we all love to see the oil producers' books for the last 25 years? State ownership of the gas line, in any amount, ensures this access plus more revenue.

Sure, we have had failures like the Delta barley projects and others. But, a state-owned gas authority, run by private industry whose expertise is in building and operating successful gas pipeline projects, is another matter. The Alaska Permanent Fund Corp. is structured to prevent politicians from meddling and has been undeniably successful. We can adapt that model to the needs of a pipeline authority.

So why the highway route? Someone should ask the governor this question. Given his disinclination to ask the producers to do anything that they don't want, he may see the highway as his only option. And when it craters in a year or two because of competition from cheaper gas in Canada and the Lower 48 or imported LNG from Australia and Indonesia or because of the need to change the ANGTA treaty (a lawyer's field of dreams), he may think he will be able to say he tried.

This is simply wrong. The producers and the governor do not get to tell us what's best for our gas. We own it. It's up to Alaskans to make sure that it's developed in a way that maximizes benefits for Alaskans.

If you want jobs, revenues, and gas for Alaska, you're going to have to get informed and involved. You can start at www.alaskagaspipeline.org, which is packed with information to help you make up your own mind about what is best for Kenai-Soldotna, Alaska and your future.

I encourage you to attend the hearing and ask the Gas Policy Council when it expects to have answers to these questions. The answers will help them make the right decision for Alaska.

Scott Heyworth is the director of Our Gas, Our Future, a private business formed to advocated for the for the gas pipeline project that most clearly follows the mandate of Alaska's Constitution. He has been a Longshoreman in Anchorage for 31 years. He is an Anchorage Public Safety Commissioner and is on the board of Easter Seals.

people are not in favor of Alaska Highway route.

Where are Alaskans on this issue?

277-9981



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