Comment:  Successfully confronting an economic abyss facing Alaska requires that the oil and gas industry find more throughput for the Trans Alaska Pipeline and create a new gas pipeline.  The Federal Government is doing everything possible to deny opportunity on Federal lands for oil and gas exploration and development.  A gasline will not solve Alaska’s economic problems but it will ameloriate many of the economic challenges.

‘Binding agreements’ between a gas pipeline and shippers are critical to financing and approval of an Alaska gas project.  Solidifying binding agreements will no doubt require satisfaction of conditions precedent resulting from the open season process.  Satisfying some conditions presented by potential shippers may be within the control of project planners (i.e. size, capacity, routing, financing, etc.) while other conditions may require the passage of law.  If some conditions precedent required the creation of fiscal certainty associated with Alaska tax and regulatory policy, the parties would have to make those conditions known and the Alaska government would have to act positively on them. So far, project proponents have not revealed what the conditions precedent are.  Therefore, lawmakers and the governor cannot today be constructing a legislative remedy for an unknown condition.  In order for issues to be acted on quickly during the 2011 legislative session, they must be identified and draft legislation must be approved.  Then consensus must be achieved.  The Governor must be supportive.  

Can fiscal clarity be achieved in the next four months to the satisfaction of pipeline shippers?  Or will the the project slip another year while Alaska’s economy steps closer and closer to the economic abyss?  -dh

ADN by Becky Bohrer.  TransCanada Corp. says it might not meet its target of securing binding agreements by year’s end for a multibillion-dollar natural gas pipeline in Alaska, but the company remains optimistic about the prospects for its project.

Homer Tribune.  As the Arctic National Wildlife Refuge celebrates its 50th anniversary this week, Gov. Sean Parnell’s (NGP Photo) timing for a letter on the topic to President Obama needs be noted.  Parnell’s letter urged President Obama to reject the advice of a group of U.S. senators and environmental groups to create a monument of the coastal plain of AMWR.  “The State of Alaska strongly opposes any measures that would further encumber job potential and domestic energy production on the coastal plain of ANWR, the most promising unexplored petroleum region in North America,” Parnell wrote to the president. “Beyond this, there are compelling legal reasons that argue against a monument designation. The State of Alaska Department of Law has reviewed this matter and determined that such action would violate federal law, unless ratified by both houses of Congress.”