Kleeschulte, Torgerson clarify Murkowski’s position on gasline bills

Petroleum News Alaska Staff

Recently, it has been said in and out of legislative committee meetings that Alaska’s U.S. Sen. Frank Murkowski is strongly behind the passage of House Bill 519, which provides a tax holiday from sales and property tax during the construction of a North Slope gasline and its first two years of operation. (See top story on HB 519 on page 1.)

Long-time Murkowski aide Chuck Kleeschulte told PNA April 23 that while Murkowski has publicly supported state participation in trying to make a gasline occur, he didn’t think the senator had recommended either HB 519 or the other gasline incentive bill, Senate Bill 360, specifically, nor did he think there was necessarily an immediate need to get state legislation passed in order to show members of Congress that Alaska was willing to offer incentives to get the gasline built.

“Sen. Murkowski doesn’t try to influence the state Legislature. He recognizes that it is an independent entity,” Kleeschulte said.

The confusion over Murkowski’s position might have started last fall, state Sen. John Torgerson told PNA April 24, when the North Slope gas owners — BP Exploration (Alaska) Inc., ExxonMobil Production Alaska and Phillips Alaska Inc. — produced a one page report showing the governments’ take if a gasline was built.

“If my memory serves me correctly, they said the state would earn $22 billion and the feds $24 billion,” Torgerson said.

“Sen. Murkowski, at that time, asked what the state was going to put up” in terms of financial incentives for the gasline, he said. “We said we were willing to look at all options as soon as the producers told us what they would need,” Torgerson said. “But they have been busy with more critical, federal, legislation.”

Torgerson said he would vote against HB 519 “as it’s written now. … I don’t like the fact the state’s going to lose $750 million in taxes without knowing if the producers need a break. … We need their financial information on the gasline first. … And we need access for the explorers and some other things,” which are provided for in SB 360.

“The two bills are relatively close — actually I have about three more incentives than they do,” he said.

But “SB 360 takes the carrot and stick approach. They have to give us something, such as in-state access to the gas and space in the line for the gas explorers. … I think it’s in the best interest of Alaskans to do that,” Torgerson said.

He thinks it is unlikely SB 360 will pass the Legislature this year because of more pressing budget issues that have to be addressed before the Legislature must adjourn on May 14.

He did not comment on the fate of HB 519, which supporters say has a better chance of passing this session.