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Senate bill has financial incentives for Alaska pipeline. (Government Guidelines).

The energy bill which will come to the floor of the Senate sometime this winter has a provision which authorizes a federal guarantee for up to 80 percent of the value of any loan up to $10 billion obtained by the builders of an Alaskan natural gas pipeline. That is just one of the provisions concerning an Alaskan gas pipeline in the bill sponsored by Senate Majority Leader Tom Daschle (D-SD).

The Alaskan pipeline provisions may come under attack in the Senate, however, from Alaska's two senators. Sen. Frank Murkowski (R-AK), the top Republican on the Senate Energy Committee, complains about not being consulted on the bill. "The Democrat bill includes provisions dealing with the development and transportation of natural gas owned by the State of Alaska," he says. "These provisions were developed behind closed doors and without consultation from Alaska's congressional delegation or Democratic governor. It is one thing for the majority leader to take issue with the strong support of Alaskans to develop federal land in Alaska. It is quite another for the majority leader to dictate to Alaskans how state-owned resources will be developed."

Murkowski is reportedly ticked off at a Daschle provision setting up an "expedited process" for FERC to consider and act on any application to build an Alaskan pipeline. This would be an alternative to the process set up under the Alaska Natural Gas Transportation Act of 1976. Applicants for certificates to build any section of a Prudhoe Bay to Alberta gas pipeline, regardless of the route, would be required to have a contract to transport Alaska natural gas that is destined for the lower 48 states. This would substitute for the "public need" finding that FERC typically requires when a construction permit application is filed under the Natural Gas Act.

Neither the loan guarantee nor the expedited approval process were in the House energy bill passed last August. The Senate bill is also notable for what it does not contain: any language limiting a pipeline route to the so-called southern route which goes south from Prudhoe Bay to near Fairbanks and then east along the Alaska Highway. The House bill contains such a provision, which is backed by the entire Alaskan congressional delegation and Alaska Gov. Tony Knowles.
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Comment:Senate bill has financial incentives for Alaska pipeline. (Government Guidelines).
Author:Barlas, Stephen
Publication:Pipeline & Gas Journal
Article Type:Brief Article
Geographic Code:1USA
Date:Feb 1, 2002
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