Here's the press release:
Anchorage – September 7, 2006 – Sarah Palin and Sean Parnell, Republican Candidates for Governor and Lt. Governor announced today their plan to get Alaska’s vast natural gas reserves to market.
At a press conference at the Hotel Captain Cook, Palin set the stage for her administration's gas line plan.
"To get Alaska’s gas to market on Alaska’s terms requires trusted leadership and negotiations that work,” said Palin.
"The Stranded Gas Development Act (SGDA) set up the legal authority for negotiations, but it was not a process that envisioned today's economic environment. For example, in today's climate of sustained high oil and gas prices, there is no way, under any interpretation of the law, that the gas on the Slope can be deemed "stranded."
Independent studies by international energy consulting firm EconOne, consultants Daniel Johnson and Dr. Anthony Finizza, also make a strong argument that Alaska’s gas is not stranded based on current market conditions.
Whether the gas is "stranded" is not just legal semantics - the implications are enormous. Once negotiations are free of the Stranded Gas Development Act, the door to competition is wide open.
“The free market will work if we allow it to,” said Palin. “This market will include, but not be limited to, BP, Exxon Mobil and ConocoPhilips. However, I will not allow them a monopoly, nor will I accept that huge concessions are the only way to get the line built.”
Palin acknowledged that in the recent past, at least four independent companies applied to build Alaska’s line but were not allowed to participate.
“In my administration, all qualified entities will have the right to compete, and there will be no preferences,” said Palin. “Through a competitive process, the same three oil companies may come out on top. An LNG route might also prove the most viable option - if not as a primary route, then as a secondary route. But I repeat: no one project or route will have a unique advantage at the negotiating table. The mission is to get Alaska’s gas to market.”
The following is an outline of Palin’s plan:
At the beginning of the next legislative session in January, the Palin-Parnell Administration will introduce a bill to the legislature seeking a “law of general application." The bill would contain three things:
• Set forth basic requirements for a natural gas line project
• Provide clear, attractive incentives for quick commencement of the gas line project
AND
• Provide for public review
The following are basic requirements that will be set forth:
• Access to Gas for Alaskan communities
• Guaranteed jobs and industry for Alaskans
• Guaranteed pre-construction benchmarks
• Expansion provisions that ensure further exploration for natural gas.
• Reasonable tariff structure
• Oil taxes will not be part of any gas line contract
• The Legislature must have approval authority of the contract
The following incentives that will be offered include:
• Tax deferrals/incentives (particularly during construction phase)
• Accelerated permitting
• Options for direct financial participation by the State
• Commitments for infrastructure support (could include public roads, airports, rail, bridges, etc.)
• Economic impact assistance for local communities
The gas line project will be built expeditiously since timely commencement will be a requirement in order to obtain of the incentives.
Again, the key is that these negotiations will go forward as a law of general application – not under the Stranded Gas Act. The benefits of proceeding in this manner include allowing more entities to come to the negotiating table, as well as avoiding increased costs and delays created from litigation risks inherent in the Stranded Gas process. |
