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April 2015

Vol. 20, No. 17 Week of April 26, 2015

Halford confirmed but Paskvan, Gallagher don’t win approval

All of Gov. Bill Walker’s cabinet-level appointments were confirmed by the Alaska Legislature April 19. Other oil and gas related appointments met with mixed fates.

Mike Gallagher did not win confirmation to the Alaska Oil and Gas Conservation Commission; Joe Paskvan was not confirmed to the board of directors of the Alaska Gasline Development Corp.

Floor debate on the Gallagher nomination indicated concern about his background. Even those speaking in opposition had nothing personal to say against him, just that he lacked the type of oil and gas background relevant to AOGCC, described as a highly technical board. Gallagher worked on pipeline projects in the state, a long-time official with the Laborers’ International Union of North America and most recently was project manager for the Alaska Laborers Training School.

Statutory requirements for the three AOGCC commissioners are that one shall be a petroleum engineer, one shall be a geologist and one member “shall have training or experience that gives the person a fundamental understanding of the oil and gas industry in the state.”

The statutory requirement for the public member of the commission was changed under Gov. Sarah Palin, who was appointed to the public seat by Gov. Frank Murkowski and served on the commission in 2003 and 2004.

Over the past 20-some years the position was primarily held either by appointees with general administrative background (Tuckerman Babcock, 1993-96, Mary Marshburn, 1997 and Palin), or by attorneys with oil and gas experience (Camille Oechsli Taylor, 1997-2003, John Norman, 2004-14, and David Mayberry, 2014-15).

2006 change

Prior to the 2006 change the statutory requirement for the third member said that individual “need not be certified, trained, or experienced in either the field of petroleum engineering or the field of petroleum geology.”

When a bill proposing a change was introduced in 2005 by Rep. Vic Kohring, chairman of the House Special Committee on Oil and Gas, it required that the public member be an attorney, have a degree in business management or have substantial management experience. A committee substitute changed that to “training or experience that gives the person a fundamental understanding of the oil and gas industry in the state.”

Kohring said in a hearing that the administration hadn’t supported the original bill, so the definition had been made more generic, but he said the oil and gas industry is so technically sophisticated that it is important that the public member come in with fundamental knowledge of the industry and compared AOGCC to the Regulatory Commission of Alaska, whose members are required to have substantial experience.

John Norman, then chairman of the commission, told legislators in 2006 that the commission regulates an increasingly complex oil and gas industry, and handles a large number of permits, applications and orders. He said there really isn’t time for on-the-job training. A commissioner has to be able to hold their own in deliberations with the other commissioners; that’s how decisions are made, he said.

Norman also said that knowledge or experience does not mean alignment with the interests of the oil industry, and noted that some commissioners have come from the oil and gas section of the Attorney General’s office, while his own experience as an attorney included representing a wide range of interests on the opposing side of the table from the oil and gas industry.

AGDC board

The governor got a mixed confirmation result on the three public members he named to the Alaska Gasline Development Corp. board of directors: Rick Halford, Joe Paskvan and Hugh Short.

They replaced replacing three original board members he dismissed earlier.

Short, chairman and CEO of Pt Capital, an Anchorage-based investment firm, and previously president and CEO of Alaska Growth Capital, was confirmed without objection.

Halford and Paskvan, both former legislators, Halford a Republican and Paskvan a Democrat, drew objections, and there was considerable floor discussion on both nominations.

The AGDC board was established under House Bill 4 in 2013, and includes two commissioners and five public members appointed by the governor and subject to approval by the Legislature. Public members serve at the pleasure of the governor.

The statutory language says: “When appointing a public member to this board, the governor shall consider an individual’s expertise and experience in natural gas pipeline construction, operation, and marketing; finance; large project management; and other expertise and experience that is relevant to the purpose, powers, and duties of the corporation.”

Considerable discussion in the floor debate centered on whether the governor was constrained to appoint board members with specific expertise as listed in the statute, or merely had to consider such expertise.

Both votes were divided, with Halford gaining confirmation and Paskvan failing, with a large number of senators voting against Paskvan, who served in that body for four years. Halford served in both bodies, a combined total of more than 20 years, and was House majority leader, Senate majority and minority leader, and Senate president.

Alaskans vs. specific expertise

Walker has said in making nominations that he is wants to name Alaskans who will focus on the interests of the state. In making the original nominations to the board in 2013, former Gov. Sean Parnell focused on what he called “deep and diverse expertise” and said the individuals he named “have proven individual track records and success in team settings.”

Those original board members were John Burns, a lifelong Alaskan, the board’s current chairman, a lawyer and former Alaska attorney general; Dave Cruz, also a lifelong Alaskan, president of Cruz Construction, Cruz Energy Services and Cruz Marine; Al Bolea of Big Lake, a retired BP executive who was formerly chairman of Alyeska Pipeline Service Co. and CEO of Dubai Petroleum; Drue Pearce, a former Alaska legislator who served as president of the Senate and as the first federal coordinator for Alaska natural gas transportation projects; and Dick Rabinow of Houston, formerly of ExxonMobil, who served as president of ExxonMobil Pipeline Co. and president and CEO of Longhorn Pipeline Partners.

Walker fired Bolea, Pearce and Rabinow.

- Kristen Nelson






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