The state\u2019s buyout of gas pipeline partner TransCanada advanced on Monday to the floor of the Alaska Senate en route to what seems to be an inevitable approval.<\/p>\n
After a morning hearing, the seven members of the Senate Finance Committee voted to pass Senate Bill 3001 out of committee. The only member of the committee not voting in favor of advancing it to the floor was Sen. Mike Dunleavy, R-Wasilla.<\/p>\n
A vote of the full Senate could take place as soon as Tuesday.<\/p>\n
Before the passage out of committee, Senate Finance Committee chairwoman Anna MacKinnon, R-Anchorage, called a succession of state commissioners and gasline experts to testify and give one final opinion on SB3001.<\/p>\n
The committee had revised the bill after state agencies said they needed less money to complete their role in the current phase of the project.<\/p>\n
The Legislature remains in special session as it weighs whether to allocate $157.6 million to pay for the state\u2019s share of the first phase of AKLNG, a megaproject that would take gas from the North Slope to Cook Inlet at a cost of between $45 billion and $65 billion.<\/p>\n
To avoid paying up front for its one-quarter share in the project, the state entered into a contract with Canadian firm TransCanada. Under the terms of the agreement, TransCanada pays all of the state\u2019s direct costs until construction begins, then half of the state\u2019s share of construction costs. In return, the state gives TransCanada a cut of its revenue once gas starts flowing.<\/p>\n
If the pipeline deal falls apart for any reason, or if TransCanada wants to walk away from it, the state must repay TransCanada every dollar plus 7.1 percent interest.<\/p>\n
That\u2019s a high interest rate compared to the open market, which is why the state is considering a buyout and has earmarked $68 million of the legislative request to take an \u201cofframp\u201d built into the TransCanada contract. If the state doesn\u2019t act by Dec. 31, its next offramp is years (and hundreds of millions of dollars) later.<\/p>\n
In the House, lawmakers used a Monday hearing to launch questions at state officials familiar with the project, then took public comment from Alaskans.<\/p>\n
Most who offered their two cents were in support of the buyout.<\/p>\n
\u201cI support the 48-inch pipe, and I want to see TransCanada phased out in the honorable way you are doing,\u201d said Bill Warren of Nikiski.<\/p>\n
He said Alaskans who compare AKLNG to the failed Delta Barley Project or the failure of the Matanuska Creamery are doing Alaska no service. \u201cYou\u2019ve got to have a pipeliner\u2019s mentality,\u201d he said. \u201cWe\u2019ve got to get it done.\u201d<\/p>\n
Barbara Huff Tuckness, a spokeswoman for Teamsters Local 959, said \u201cWe do believe it\u2019s a positive thing going through.\u201d<\/p>\n
Juneau engineer Mark Morris said he heard about the opportunity to talk from Rep. Sam Kito III, D-Juneau, and decided to stop by.<\/p>\n
In his testimony, he compared the state\u2019s situation to what it was in the 1970s.<\/p>\n
\u201cI call this the Jay Hammond days all over again,\u201d he said.<\/p>\n
He said the whole state has benefited from the oil pipeline, and it stands to do the same from a gas pipeline.<\/p>\n
Anchorage\u2019s Tom McCosh offered the sole voice in opposition to the buyout.<\/p>\n
\u201cI oppose this corporate welfare and bailout of TransCanada,\u201d he said by phone.<\/p>\n
Among the handful of ordinary Alaskans who spoke \u2014 testimony lasted only half an hour \u2014 McCosh was in the clear minority.<\/p>\n
Most who offered their opinions had views similar to that of Chugiak\u2019s Bill Nelson. \u201cI\u2019m tired of repeating mistakes that we have done,\u201d he said, comparing the current gas pipeline to past ideas. \u201cIt\u2019s about time that the state took it over.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
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