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Palin Proposes Legislation to 'Jump-Start' In-State Pipe

Acknowledging that the construction of an in-state natural gas pipeline takes priority over the development of a larger pipeline to serve the Lower 48, Alaska Gov. Sarah Palin has submitted two pieces of legislation to the state House and Senate rules committees as part of an plan to jump-start a pipeline that would tap North Slope supplies and deliver them to the southern region of the state.

The plan will include an evaluation of options for routes, gas resources and potential industrial and residential users. Palin said a specific timetable will be established to begin work on right-of-way and permitting, as well as preliminary engineering and cost estimates. The plan will form the foundation of development of in-state gas transportation systems to deliver the resource to the people of Alaska.

According to a rough timeline for the project released last week, phase II, the establishment of the project, would be completed by June 2011. Preparation for construction would be completed by June 2013. Construction would be completed in October-November 2014 for first gas flows to take place in January 2015.

"Alaskans have been excited about the progress made toward our big gasline, which will secure our fiscal future as we take this abundant resource to Lower 48 markets," Palin said. "But we know that we cannot wait for that project to come to fruition before addressing our own heating and power generating needs. My administration is committed to getting the ball rolling now on a pipeline strictly for Alaskans."

Palin said the first bill broadens the responsibilities of the Alaska Natural Gas Development Authority (ANGDA). Under current law ANGDA is restricted to examining and promoting a pipeline project intended to deliver North Slope natural gas to the coast for export as liquefied natural gas. The requested revisions will allow ANGDA to examine and pursue all options to supply Alaskans with natural gas.

The second bill proposes changes to the Right Of Way Leasing Act and the Pipeline Act. It addresses technical right-of-way issues for pipelines and clarifies oversight by the regulatory commission of Alaska. This package of proposed legislation will form the initial statutory framework for the development of an in-state gasline for use by Alaskans.

In late January Palin said her goal was to have an in-state 460 MMcf/d pipeline constructed in five years (see NGI, Jan. 26). A report prepared in early February pointed out that the state needs to focus on supplying its own people before worrying about supplying the Lower 48 (see NGI, Feb. 9).

The report noted that each of the in-state gas distribution proposals reviewed -- ENSTAR Natural Gas' bullet line, the ANGDA spur line and Fairbanks Natural Gas' trucked North Slope LNG project -- faces challenges and do not, as stand-alone enterprises, appear to satisfy Alaskans' energy timeliness and affordability requirement. The report concludes that "each contains components that, if aggregated, could provide Alaskans with affordable energy and mitigate air quality issues in an acceptable time frame."

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