Governor: producers submit unified response to state’s pipeline equity offer

Alaska Gov. Frank Murkowski said Dec. 16 that the North Slope producers’ group has responded to the state’s proposal to take an equity interest in the Alaska gas pipeline.

“Yesterday, Santa Claus came early,” the governor said.

In October, the governor said, the state put a major proposal before the North Slope producers for the state to take an equity position in a gas pipeline project “in return for a trade of the severance and royalties, and on Dec. 15 … the producers came back with a comprehensive joint response to the state’s proposal.”

This response, he said, “represents a unified position of all the three producers.” What the state received is a “comprehensive proposal” to the state from BP, ConocoPhillips and ExxonMobil.

“I want to make it very, very clear to the people of Alaska that for the first time ever, ever, ever … the producers have made a proposal to build a natural gas pipeline. … What we have here, in my opinion, is very significant, because it’s the first time we’ve ever had a specific submission to build this project and clearly it comes from those who hold the gas leases.”

With other proposals, he said, there is always the issue of getting the gas.

“We finally have a concrete proposal,” the governor said, “from producers that hold the gas leases...” The governor said the state will now negotiate the Dec. 15 proposal with the producers. Once agreement is reached, a final proposal will go to the Legislature for approval. The state is also negotiating with TransCanada under the stranded gas act, the governor said, “and we intend to proceed with that.”

The state will also, he said, proceed with discussions it is having outside the stranded gas act with the Alaska Gasline Port Authority, Sempra, Calpine, the Alaska Natural Gas Development Authority and MidAmerican.