A representative of the governor's gas line expansion plans at times struggled on Friday to answer pointed questions from a House committee worried the upsizing will throw an industry-backed gas line project off track.
The awkwardness of the session in Juneau seemed best exemplified when Dan Fauske, president of the state gas line corporation, changed course after initially saying he was not trying to dodge a question about whether he is Gov. Bill Walker's point man on the expansion.
"I'm not trying to weave my way through it," said Fauske. Then he shifted: "Maybe I am."
The comment drew laughter but Rep. Mike Hawker said it illustrated a huge problem. He said the governor has sown confusion by saying he will create a competing project that could threaten the Alaska LNG gas line effort pursued by the state, Exxon Mobil, ConocoPhillips, BP and TransCanada.
Hawker introduced the bill that led to the creation of the Alaska Gasline Development Corp. in 2009. It has spent about $160 million studying the relatively small Alaska Stand Alone Pipeline, a $10 billion project designed primarily to get gas to Alaskans. The gas line project has so far functioned as a backup, not a competitor, to the larger proposal.
AGDC was more recently tasked with helping represent the state in that larger Alaska LNG project, which would export gas to Asia and could cost more than $65 billion.
The dual efforts come because the state has tried for decades to produce and sell its vast quantities of natural gas locked on the North Slope. With oil production dwindling, many Alaskans see the natural gas as key to the state's economic future.
Walker said in an editorial last month the state would upsize the smaller line to make it economically viable and look for export opportunities, essentially putting it in competition with the larger project.
Whichever project is first to "produce a solid plan, and at conditions acceptable to the state, will get the state's full support," he wrote.
That new approach is playing out on the AGDC board now that Walker has dramatically changed its composition after taking office in December. Five of the board's seven members work for or have been appointed by Walker.
Hawker, vice chair of the Resources Committee, told a reporter that three of those are public members -- Hugh Short, Joe Paskvan and Rick Halford -- who have yet to be confirmed by the Legislature.
In the Resources Committee update, Fauske explained that the board on Thursday asked his staff to develop a rough estimate of the time and money it will take to seriously study increasing the gas volume in the smaller line. That report will be developed within a month. Depending on what those costs might be, a later decision can be made on whether the detailed upsizing studies should be pursued, Fauske said.
"What's changed is we have been asked to supply some numbers," Fauske said.
Hawker said he was confused because Fauske seemed to be taking a less competitive tone than Walker had taken in his editorial.
"I don't know who's credible," Hawker said. "I don't know if the governor is planning to do what he's said publicly or it's just kicking the tires on some larger pipe (as I've heard today). I'm horribly confused."
The uncertainty has led the U.S. Army Corps of Engineers to recently suspend work for two months related to a supplemental environmental impact statement for the smaller line, said an official with the gas line agency.
Hawker worried that federal agencies working on permitting for the Alaska LNG project could follow suit, not knowing which project the state prefers.
"That could happen, absolutely," Fauske said.
Hawker pointed out that the oil companies who own rights to the gas have committed that gas to the Alaska LNG project. He said the state will have to identify a source of gas as well in order to win approval for an export license from the Energy Department, something the Alaska LNG project has received for export to free-trade countries.
Hawker asked if the same gas can be committed to two projects.
Fauske said probably not, though he didn't know for sure.
Hawker pointed out that the state doesn't have gas until the oil producers produce it.
"That is correct," said Marty Rutherford, deputy commissioner for Natural Resources.