Gov. Frank Murkowski is asking the Alaska Legislature to appropriate almost $10 million for the state’s efforts to get a North Slope natural gas line built. The request includes a proposal that the state obtain the pipeline rights of way even before a developer steps forward to build the project.
The idea is that the state could speed up development if it has all of the necessary rights of way ready for whenever a company or group of companies steps up to build the line for moving North Slope gas to market.
“The state would actually permit its own right of way,” Mark Myers, director of the Oil and Gas Division, told the Senate Finance Committee.
The Oil and Gas Division is asking for $3.9 million to pay for the right-of-way work. The request is part of the governor’s supplemental appropriations measure, Senate Bill 313, which received its first hearing April 2 in Senate Finance. The committee took no action on the bill.
Myers explained the proposal is that the state would acquire the rights of way for the pipeline’s entire route through Alaska, assign the permits to a state corporation to hold and then later transfer to the actual project developer. He did not name any specific state corporation to hold the rights-of-way permits.
The $3.9 million appropriation, if approved by lawmakers, would be available immediately. The work schedule calls for the Department of Natural Resources to finish its work on the permits by June 2005.
In addition to the right-of-way funding, the administration’s request also includes $1.58 million for a risk analysis study to determine if the state could help get the project built if it was willing to share in some of the financial risk.
Gov. Frank Murkowski said late last month the state may need to step in and share some of the risk if it is to convince private companies and investors to go ahead with the 2,000-mile pipeline from the North Slope to the North American distribution grid in Alberta.