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Walker presses Point Thomson challenge Gubernatorial candidate objects to Parnell settlement of field conflict; Alaska Supreme Court to hear oral argument in December Wesley Loy For Petroleum News
Bill Walker, an announced candidate for governor, is continuing his challenge of the state’s landmark Point Thomson settlement.
The settlement, reached in March 2012, resolved years of conflict between the state and major oil companies over the rich but undeveloped Point Thomson oil and gas field on Alaska’s North Slope.
The deal laid out a plan for staged development of the field, and operator ExxonMobil is now pursuing construction of a project to produce natural gas condensate beginning in early 2016.
Walker went to state Superior Court to challenge the Point Thomson settlement, but a judge tossed the case.
He appealed to the Alaska Supreme Court, and that’s where the matter stands today.
Walker and lawyers for the state have been exchanging legal papers, and the high court is scheduled to hear oral argument on Dec. 12.
Major gas field Walker is an Anchorage attorney and former mayor of Valdez.
He challenged incumbent Gov. Sean Parnell in the 2010 Republican primary, coming in second with about 33 percent of the vote. Parnell took 50 percent and Ralph Samuels 14 percent.
On Aug. 1, Walker announced he would run as an independent candidate for governor in 2014.
The Parnell administration inked the Point Thomson settlement with ExxonMobil and its Point Thomson partners, including BP and ConocoPhillips.
The settlement ended a seven-year fight for control of the field, located on state leases about 60 miles east of Prudhoe Bay.
State officials have long awaited production from Point Thomson, and say the settlement contains strong terms to compel ExxonMobil and its partners to either produce or surrender acreage.
Point Thomson is estimated to hold some 8 trillion cubic feet of natural gas, plus large volumes of petroleum liquids.
The gas represents about a quarter of the known reserves on the North Slope. Thus, the field is very important for the proposed trans-Alaska gas pipeline.
Gas condensate is a form of light oil. ExxonMobil is building a short pipeline to tie in Point Thomson with the North Slope’s existing oil pipeline network.
Walker, a longtime proponent of a natural gas pipeline, has raised a number of objections to the Point Thomson settlement, arguing it was unlawful and a bad deal for the state.
He first brought his legal challenge as a “citizen taxpayer” in May 2012.
‘Secret’ deal In a Sept. 27 filing with the Alaska Supreme Court, Walker’s attorney, Craig Richards, asked the court to void the lower court’s dismissal of Walker’s case.
The filing said “there are few comparable deals in the annals of Alaska history” like the Point Thomson settlement in terms of its scope, term and the value of the natural resources involved.
In the past, the state and oil companies have worked such megadeals as the Exxon Valdez oil spill settlement, and renegotiation of the Northstar field leases, the filing said.
A hallmark of these past deals was “extensive public vetting and active checks and balances by the other branches of government,” Richards wrote.
This didn’t happen with the Point Thomson settlement, he said.
Rather, the state natural resources commissioner and the attorney general “negotiated and signed the deal in secret, rushed dismissal of the underlying litigation before the deal went public, and then claimed its terms were not subject to legislative review or administrative appeal,” the filing said.
Among Walker’s other complaints is that the settlement agreement contained “no firm work commitments” for ExxonMobil and the other working interest owners in the field.
Lawyers for the state argue that Walker really has no basis to challenge the settlement.
In a brief filed with the Supreme Court, the state argued the attorney general has “exclusive discretion to settle cases.”
The Superior Court correctly dismissed Walker’s case for lack of jurisdiction to hear his administrative challenge, the state lawyers said.
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