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December 2009

Vol. 14, No. 52 Week of December 27, 2009

Cook Inlet recovery act

Alaska state Reps. Mike Hawker, R-Anchorage, and Mike Chenault, R-Nikiski, said Dec. 22 that they will introduce legislation promoting Cook Inlet natural gas exploration, production, storage and deliverability.

The men are in the final stages of preparing their legislation and are reviewing the initial proposal with Cook Inlet stakeholders, including regulators, community organizations, explorers, producers and utility companies.

Hawker and Chenault said in a statement that the Cook Inlet Recovery Act will provide tax and regulatory incentives to construct large gas storage facilities to help meet consumers’ peak winter gas demands; allow more rapid recovery of exploration tax credits to entice private investment; and eliminate a production tax penalty imposed on companies working both in Cook Inlet and on the North Slope.

They said the legislation will also help protect consumers from the threat of gas delivery interruptions by addressing state regulatory policy that has resulted in “the ill-conceived rejection of critical, long-term gas supply contracts negotiated by utilities.” (This is a reference to difficulties utilities have had securing approval for gas supply contracts from the Regulatory Commission of Alaska.)

“The Cook Inlet Recovery Act is consumer-security legislation to help ensure Southcentral Alaskans have enough natural gas to keep their homes and businesses warm and their lights on every day of the year,” Hawker said.

“The economy of the Kenai Peninsula has been economically devastated by declining natural gas exploration and production,” Chenault said. “The lack of sufficient natural gas now threatens the safety of everyone in Southcentral Alaska and we need to do something about it.”

This won’t be the only bill in next year’s Legislature promoting natural gas storage.

Sen. Hollis French, D-Anchorage, said in early November that he plans to introduce legislation to provide tax incentives for development of natural gas storage capacity in Cook Inlet, and also cited concern with potential winter gas supply shortages for homes and businesses in Southcentral Alaska.

Prefiled bills will be released Jan. 8 and Jan. 15; the session begins Jan. 19.

—Kristen Nelson






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