House panel version of gas-line bill takes shape

Published on NewsOK Modified: April 5, 2014 at 8:55 pm •  Published: April 5, 2014
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JUNEAU, Alaska (AP) — The House Resources Committee version of a bill to advance a major liquefied natural gas project was starting to take shape Saturday, as members dug into a thick stack of proposed changes.

The committee, with a reputation for finely parsing language, was making slow but steady progress in an amendment process that began Friday. The panel planned to resume work Sunday, after making a slight dent in the stack after hours of meeting Saturday.

Changes that had been approved included a provision to require negotiated contracts that must get legislative approval, such as marketing and transportation-services agreements, to be made public at least 90 days before the proposed effective date for the contract. Co-chair Rep. Eric Feige, R-Chickaloon, said the idea is to ensure there is adequate time to vet proposed contracts, months instead of a few days.

The committee also approved allowing for certain legislative staff members and legislative consultants to be part of confidential briefings on negotiations rather than only lawmakers. Another amendment required legislative briefings on project progress every four months, accompanied by a written report by the Department of Natural Resources on the amount of money the state may be obligated to pay TransCanada Corp. if a project were terminated before gas starts flowing.

The bill under consideration by House Resources, SB138, from Gov. Sean Parnell, would set state participation in the project, also being pursued by the North Slope's major players, TransCanada and the Alaska Gasline Development Corp., or AGDC, at about 25 percent. It also is aimed at moving the project — currently estimated to cost between $45 billion and more than $65 billion — into a phase of preliminary engineering and design and cost refinement.

It is one of the biggest issues of the legislative session, scheduled to end April 20. House Resources is one of three House committees to which the measure has been referred, though House Speaker Mike Chenault has said the referral to Labor and Commerce could be waived, allowing for the measure to go next to House Finance.

As proposed, TransCanada would hold the state's interest in the gas treatment plant and pipeline, with the state having an equity buy-back option. The arrangement has been cast by Parnell administration officials as a way for the state to not have to bear as much in upfront costs as it would on its own and as an amicable transition from terms under the Alaska Gasline Inducement Act, under which TransCanada had been pursuing a project for years. Parnell has said terms of the act do not apply to the project currently being pursued.