Senate approves route restriction amendment for gasline

Petroleum News Alaska Staff

The U.S. Senate adopted an amendment to the energy bill on March 6 that designates southern routes for a natural gas pipeline from Prudhoe Bay versus an “over-the top” route across the state’s northern coast to Canada.

The amendment was introduced by Senate Majority Leader Tom Daschle, D-S.D., and amended at the request of Alaska Sen. Frank Murkowski to include not only the Alaska Highway route to Canada but also the possibility of a line to Valdez, Anchorage or the Kenai Peninsula where the gas could be liquefied and transported by LNG tankers.

The amendment allows for a joint state/federal effort to oversee the pipeline project. Murkowski added language to the amendment that authorizes a $20 million program to train Alaskans to provide labor for gasline construction. The training centers, to be set up within a year of the bill’s passage, will be funded by a separate appropriation Alaska Sens. Murkowski and Ted Stevens tacked on language that says nothing in the energy bill can prevent the line from being tapped to take gas to other parts of the state.

The route restriction amendment was approved by a vote of 93-5 and was the first floor amendment to the Democratic majority’s energy policy bill released March 5.

In addition to a southern route for the gas line, Daschle said he would support an amendment to the bill to reduce risk to pipeline investors via a tax credit when gas prices fall below a certain level.

The route restriction amendment contained no such provision.