Alaska has window to develop new oil, gas, Begich says

March 22, 2011 

Begich Legislative Address

U.S. Sen. Mark Begich answers a question during a news conference March 23, 2011, in Juneau. The Democrat believes that concerns about energy costs have created an opportunity for the state to press the federal government for greater oil development in Alaska.

BECKY BOHRER / THE ASSOCIATED PRESS

JUNEAU -- High energy prices and political turmoil overseas have led to a "much more aggressive" attitude in Washington, D.C., toward developing oil and gas resources at home, U.S. Sen. Mark Begich said Tuesday.

That's good news for Alaska, which he said has a small window through which to push the idea of making offshore assets and more federal lands in the state available for exploration and production.

When lawmakers return to Washington from their spring break, they will have had their "heads beaten in by their constituents" over rising gasoline and energy costs, "and they're going to come back and have to take a re-examination of the energy issue," Begich, D-Alaska, told reporters.

Begich said that within his own caucus, there's talk of resurrecting debate on a national energy plan. For any energy plan to work, he said Alaska must be a critical piece, a point he made recently to President Barack Obama. That means developing in areas like the Arctic National Wildlife refuge, offshore Arctic waters or the National Petroleum Reserve-Alaska.

He said Obama seemed "more aligned with the majority of what I'm talking about" but that federal agencies, like the Environmental Protection Agency, aren't. He said that must be addressed.

Earlier in the day, Begich told a joint session of the Alaska Legislature that he and the rest of the state's congressional delegation are exploring their options for addressing two different processes and standards for overseeing air permits. He said the current system puts companies with projects in the Arctic at a competitive disadvantage and that all air permitting should fall under the Interior Department.

He also said he planned to introduce legislation creating a federal coordinator for the Arctic Outer Continental Shelf, a liaison of sorts to work with federal, state and local governments to try to streamline development in the Chukchi and Beaufort seas.

Shell Alaska welcomed that. The company has reported spending five years and more than $50 million so far in an effort to get an air permit for a drilling rig.

"The senator clearly understands the challenges facing responsible operators, like Shell, as well as the need for a regulatory process that is predictable and accountable," the company said in a statement. A federal coordinator "could go a long way in making that happen."

Begich said the idea is modeled on the existing federal coordinator for Alaska natural gas pipeline projects. Alaska is weighing the potential for an in-state gas pipeline while also awaiting word on whether there's sufficient interest among gas companies to move major pipeline proposals ahead.

Begich, a former mayor of Anchorage, said he believes it's imperative the state not wait too long to act on an in-state line, which could help serve the needs of some of Alaska's most populous areas. There are concerns about the current energy supplies for that region, as well as the cost and reliability.

One recent report found that heavy subsidies would likely be needed for an in-state line, which, unlike the major pipeline proposals, would not send gas to out-of-state markets.

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