The state can't afford not to support TransCanada Corp.'s proposal for a natural gas pipeline, Gov. Sarah Palin and her aides said Wednesday.

Speaking on the opening day of a three-day public forum in Anchorage, the governor and her team urged state lawmakers to give the Canadian energy company a state license and $500 million in seed money.

They said voting against awarding the license and subsidy will mean more waiting and wishing that the major North Slope oil companies someday will build a gas line.

"They own us at that point," said Tom Irwin, state natural resources commissioner. "That's what you get when you say no."

But Palin's plan for landing a gas line -- long one of the state's top economic development priorities -- might meet significant resistance from skeptics in the state Legislature.

Potential resistance was evident by some empty chairs at the forum, which the Palin administration organized as a prelude to the special legislative session beginning Tuesday in Juneau.

Notably absent were top members of the Senate leadership, including President Lyda Green, R-Wasilla, and Sen. Charlie Huggins, another Wasilla Republican who chairs the Senate Resources Committee.

Another lawmaker, Fairbanks Republican Rep. Jay Ramras, also didn't attend. He said earlier this week he felt Palin overreached by asking legislators to attend a three-day event in Anchorage before the special session begins.

But many lawmakers -- at least 40 of the state's 60 senators and representatives -- did attend at least part of the forum Wednesday, which began with Palin touting TransCanada as a muscular company that could make Alaska's pipe dream come true.

"You're here to hear a lot of good and inspiring information," she told lawmakers and some 200 others -- mostly consultants, oil company and labor union representatives and legislative aides -- who filled a large meeting room at the Sheraton Anchorage Hotel.

By mid-morning, however, some lawmakers and finally Palin herself began slipping out of the room as Revenue Commissioner Pat Galvin plowed through difficult financial concepts such as net present value and debt to equity ratios.

CONVINCING WON'T BE EASY

After months of analysis, the Palin administration last week declared it would recommend lawmakers grant the exclusive license and subsidy to TransCanada, which is proposing a 1,715-mile pipeline running down the Alaska Highway from the Slope to Alberta.

One bit of news is that state analysts estimate the cost of the megaproject at $31 billion, compared to TransCanada's estimate of $26 billion.

Palin and her aides said TransCanada's pipeline idea is better for the state than a competing pipeline proposal from oil companies Conoco Phillips and BP, who control much of the North Slope gas reserves.

In fact, Palin and her expert advisers give TransCanada and its pipeline proposal near rave reviews.

The uniform enthusiasm strikes some as a bit thick.

"There's cheerleading here," said Dan Dickinson, a former state tax director who is now advising the Legislature on the pipeline. "But it doesn't mean it's a crappy proposal."

Lawmakers seem divided on the main question: Does Palin have enough votes to license TransCanada?

"The governor is going to have to get very engaged," said Sen. Hollis French, D-Anchorage. "I don't think it's a chip shot."

Rep. Bryce Edgmon, D-Dillingham, said he'll support awarding the license. He said he agrees with Irwin that the state can't simply wait on the major oil companies to build a pipeline.

"The risk of not doing anything is too great," he said.

STILL NEED THE GAS

Other legislators said they'll wait to take in more information at the forum and in the special session before deciding.

North Pole Sen. Gene Therriault, part of the small Republican minority in the Senate, said it was "disappointing" much of the Senate majority leadership stayed away Wednesday.

From the House side, Speaker John Harris, R-Valdez, appeared for the start of the forum but departed by late morning.

The proposed state license for TransCanada is not a contract for actual construction of a pipeline. Rather, it would obligate the company only to seek permission from federal pipeline regulators to build a line.

To fill its pipeline with gas, TransCanada would need to attract big customers -- chiefly Conoco, BP and Exxon Mobil. Those companies have been reluctant to produce their gas until they know for sure how the state would tax it.

Even if work began today, it would be several years before any pipeline could begin operation.

The forum resumes at 8:30 this morning. It is free and open to the public.

Find Wesley Loy online at adn.com/contact/wloy or call 257-4590.

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