Pipeline Hurdles

The Alaska Gasline Inducement Act (AGIA) passed the Alaska House this week. The bill still requires passage by the Senate and funding before the next wave of hurdles.

Here's a link to a letter posted by RA Dillion concerning the effective date of the TransCanada proposal.

The letter is from Donald Bullock and Tamara Brandt Cook of The State of Alaska Legislative Affairs Agency Division of Legal and Research Service to Representative John Coghill, Jr concerning the effective data of the AGIA license.

Reading the letter it seems like an AGIA license is probably just the beginning of the next phase of Alaska energy lawsuits. Time will tell, but it still looks like construction of a TransCanada Alaska Gas Pipeline is years away - if ever.

AKPIRG weighs in on AGIA

From APRN:

AKPIRG weighs in on AGIA

Thur, July 24, 2008
Posted in Alaska News

The Alaska Public Interest Research Group, AKPRIG, has released a report on the Alaska Gas line Inducement Act or AGIA. The report by independent industry analyst Richard Fineberg does not take sides on pipe line projects, but says AGIA provides no assurance for the state of a fair return on its natural gas. Fineberg says, as lease holders of the gas, North Slope producers will be in a position of control even if Trans Canada’s project wins state support.

Dan Bross, KUAC - Fairbanks

On the Interweb:

AKPRIG Webpage LINK

Here's a link to the AKPRIG summary on AGIA

And a link to the full report

New Poll - Please Vote

How do you feel about the AGIA bill passing the House?

Ultimately the free market will decide - What do you think?

Alaska Gasline Inducement Act Approved by Alaska House

Next stop - the Senate

From Reuters Yereth Rosen:

The chamber voted 24-16 in the state capital of Juneau for a bill backed by Governor Sarah Palin that would grant TransCanada a state license for a 1,700-mile (2,700 km) pipeline to bring the gas to North American markets.

Government interjecting itself into a market place has seen colossal failure after colossal failure after colossal failure," said House Majority Leader Ralph Samuels, an Anchorage Republican. "Government is ill-equipped to start picking winners in the marketplace."

From Wes Loy at Anchorage Daily News

Rep. Mike Hawker, R-Anchorage, delivered a long speech citing a litany of worries with the TransCanada deal.

"AGIA -- I'm a little bit afraid it stands for Alaska Goofs It Again," he said.


This link shows how the House voted.

Frank Murkowski's view of AGIA

Alaska's former Governor Frank Murkowski sent this open letter to the Alaska Legislators:

This link will take you to a copy of the letter posted courtesy of Andrew Halcro.

"Assess the liability" Says Frank

The Most Important Alaska Resource Decision of the Century

A final assessment of the AGIA from former Governor Wally Hickel.

"Vote No" says Wally.

The Canadian View

From DAVID PARKINSON

TRANSCANADA AWAITS THE GOVERNOR'S CALL

A new natural-gas pipeline from Alaska throws together a state hungry for revenues, a Canadian carrier hungry for volumes and producers who don't want to get left out, David Parkinson reports.

The Little Susitna view of the AGIA

Dominic S.F. Lee is the president and CEO of Little Susitna Construction Co., based in Anchorage. Lee has led Little Susitna Construction, an engineering and construction company, for the past 28 years. Little Susitna was one of the rejected AGIA (Alaska Gasline Inducement Act) bidders.

Here's a link to his opinion of the AGIA. He points out how the AGIA will put Canadians in the driver's seat for development of Alaska's Natural Gas.

Former Governors Warn Against Pipeline & More

Former Governors Warn Against Pipeline

and

Producers list concerns over TransCanada line

This Weeks Pipeline Stories

While some may credit the AGIA and Alaska's Governor with moving the Alaska Gas Pipeline forward I suggest that you take a look at the chart and link to the left - It shows the price of natural gas more than doubled in the past year. Following the motto of "Lead, Follow or Get out of the Way" it looks like commodity pricing is leading, the producers (Denali Project) are following, perhaps the Governor should stay out of the way.

Links and news of interest:

Andrew Halcro has good summary of the rough and tumble world of lawmakers and the gas pipeline.

In case anyone thinks an Arctic gas pipeline project is easy take a look at this story by Ed Struzik of the Edmonton Journal. The article describes the trials and tribulations of the failing Mackenzie Delta gas line project.

This week Petroleum News carried a couple of stories worth passing on:

"Galvin on Mediation" -McGuire wants mediation; Revenue chief says Alaska first has to have position - Kristen Nelson, Petroleum News

"Definition, not mediation, please" Kristen Nelson, Petroleum News.

Cold War Brewing?

Jim Whitaker, Mayor of the Fairbanks North Star Borough sent this letter to the State Attorney General Talis Colberg. (Thanks to Andrew Halcro for posting the letter).

Sadly this is the shape of things to come - The high cost of energy will not go away in our lifetimes. The anti business political climate prevents folks from coming together to solve problems.

Instead people are divided by unreal expectations of free heat in the Arctic. You can't heat your home with lawsuits.

Perhaps the Mayor should draft a note to the various producers and ask for real world solutions with real world cost estimates so the citizens of the Fairbanks North Star Borough can have some sort of idea of what their cost of living will be 5, 10, 20 years down the road.

The U.S. average cost of residential natural gas is $14.30 per MSCF (per Energy Information Administration). When the Alaska Gas Pipeline gets built and starts flowing the cost will be much more than that. It's an ugly problem that will take some leadership and know how to solve in the near term and long term.

Good luck with the lawsuit approach.

Denali Dialogue?

Is it possible that a dialogue may open between lawmakers and the Denali Pipeline?

Senator Bill Wielechowski and Hollis French have some questions for Bud Fackrell.

Here's a link to the letter sent by Wielechowski French to Fackrell.

It's nice to know that they want to hear from the Denali team rather than just make assumptions.

Link to Stefan Milkowski's story in the News-Miner.