22nd Alaska State Legislature
News from the House Majority

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Legislative Gasline Investment 'Prudent'
$600,000 to Fund Time-Sensitive Planning - Not Speculation

For Immediate Release:

February 27, 2001


Representative Eldon Mulder at (907) 465-2647
Representative Bill Williams at (907) 465-3424

(JUNEAU) - The Legislature's $600,000 fast-track appropriation for the state pipeline coordinator's office will help Alaska prepare for credible North Slope gas line construction proposals and continued Arctic oil development without wasting money on speculative studies, House Finance Committee leaders said today.

"We are all anticipating the benefits of a gas pipeline for Alaskans, and when the right time comes we'll make the necessary investments to make it happen," said Rep. Eldon Mulder (R-Anchorage), co-chair of the House Finance Committee. "But spending almost $2 million to beef up the bureaucracy when no one has even applied for a permit is an irresponsible use of public money. Why build an expensive new cart, when we don't even have a horse?"

High energy prices and demand have prompted three of Alaska's largest oil producers to begin a $75 million economic feasibility study of bringing gas to market through a pipeline running either south along the Alaska Highway, or across the Arctic coast and south through Canada.

The House has passed House Bill 117, a supplemental budget bill including $600,000 for the Department of Natural Resource's Joint Pipeline Division for the remainder of fiscal year 2001. The money would fund planning how the state should mobilize to evaluate a variety of gas development options, including pipelines, liquefied natural gas plants, or spur gas pipelines to Alaska and Outside markets, said Mulder and Rep. Bill Williams (R-Saxman) co-chair of the House Finance Committee.

The governor had sought nearly $2 million in HB 117, including $400,000 for his new "Alaska Highway Natural Gas Policy Council" to build a consensus for a highway route, and enough funds to hire 23 new staffers in nine departments to handle permit applications, though the state has received no such applications.

"It seems that even the name of the governor's group shows it's aimed less at performing an unbiased evaluation of pipeline routes than in advancing his public relations agenda in connection with a gas line," said Mulder.

The Legislature is considering several bills related to gas development, some touting the highway route, and others supporting whatever development scheme is most likely to benefit Alaska's economy through taxes and royalties, construction and operations jobs, and reliable access to low-cost energy.

"Producers say any pipeline has to pencil out over several decades," said Williams. "The Legislature has proposed a substantial and prudent investment in the pipeline coordinator's office that will pay dividends when we get a real proposal in hand."

The Legislature also included in HB 117 a $1.5 million investment in the long-term health of Alaska's oil industry. The money would help the private lobbying group Arctic Power work on Alaska's behalf to urge congressional approval for opening the coastal plain of the Arctic National Wildlife Refuge to oil and gas development.

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