Former Arco executive urges state to unify on gas pipeline plan

Posted: Wednesday, July 11, 2001

ANCHORAGE (AP) -- A former senior Arco executive is urging state officials to come together on development plans for a gas pipeline before negotiating with Alaska's big oil companies.

Ken Thompson, former executive vice president of Atlantic Richfield Co. and president of Arco Alaska Inc., said the decisions made over the next year and a half will impact Alaska for the next 50 years.

''The governor and Legislature must be united, or we will be divided by'' the oil companies, he said Monday at an Anchorage Chamber of Commerce luncheon.

The North Slope holds at least 35 trillion cubic feet of natural gas. The companies that hold most of Alaska's gas -- BP, Exxon Mobil and Phillips -- are studying two routes for a multibillion-dollar pipeline to the Lower 48.

One route would follow the Arctic coastline to Canada before turning south. Another would follow the Alaska Highway to the Lower 48.

Thompson, who lives in Anchorage, sits on Gov. Tony Knowles' Alaska Highway Policy Council. Thompson warned that if the leaders are divided on the best route, the companies would exploit the split to possibly win concessions from the state.

The companies are expected to reach a decision on their preferred route late this year.

In August, Knowles, a Democrat, announced his support for a large pipeline that would run along the Alaska Highway to the Lower 48. He created a committee of Thompson and other community leaders to examine issues around the project. Thompson backs Knowles' highway plan.

But the Republican-controlled Alaska Legislature has not backed the project. Many said this winter that the governor jumped to a decision on the route without considering alternatives, such as a gas export project to Asia.

While the Knowles gas council holds meetings around the state about the highway pipeline route, a special legislative committee will convene in Anchorage next week to hear testimony from experts on a range of projects. As with Knowles, the Legislature opposes the Beaufort pipeline route. But some lawmakers, such as Sen. Robin Taylor, R-Wrangell, support the Asia export project.

The oil companies have dismissed as too costly the project that would send liquefied natural gas to Asia.

The oil companies, meanwhile, are holed up in an Anchorage office building assessing the different pipeline routes off the North Slope. The companies have suggested that the shorter Beaufort route may mean more state revenue.

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