Sunday, August 31, 2008

FERC to the Rescue?

The Federal Energy Regulatory Commission on Friday volunteered to help merge two competing Alaska natural gas pipeline projects into one.

High energy prices have created a free market conditions favorable to building a gas line from Alaska to supply much needed gas to develop the Albert Tar Sands.

The Alaska Gasline Inducement Act (AGIA), is slated to pay State of Alaska funds to TransCanada to work towards building a gas pipeline.

Somewhere down the road one or both of the pipelines will not be built. 

FERC, not the State of Alaska, regulates pipeline development. Maybe this is a positive step to smooth the way.  Maybe not. 

The current playing field is populated by oil and gas producers (ConocoPhillips and BP - Denali Pipeline) playing by the rules, working with FERC, working within the bounds of free market economics - on the other side Governor Sarah Palin has passed new taxes on oil companies, slowed development, and passed a Pipeline law (AGIA) that shovels money to pipeline company TransCanada with no guarantees that they will build a pipeline.

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