Anchorage Daily News

We have a Frank Murkowski sighting.

The rarely seen former governor appeared at a luncheon of Anchorage business bigwigs Monday, dishing criticism for the way his replacement has handled her pursuit of a natural gas pipeline.

The Legislature ought to rethink Gov. Sarah Palin's pipeline plan, Murkowski told an Anchorage Chamber of Commerce crowd. To avoid lawsuits and delays, lawmakers should look for deal-killing roadblocks and compare it to a competing proposal from oil giants Conoco Phillips and BP, he said.

"I'm not optimistic that, as structured, this strategy is going to work," Murkowski said of Palin's plan, which he said is based on "politics and ideology" rather than thinking of it as a business deal

Resolving the state's dispute with Exxon Mobil over the Point Thomson natural gas field is crucial to the pipeline's success, and the state should explain why it recently denied Exxon a permit to build an ice road in the region, Murkowski said.

"To suggest that you can't trust Exxon, I think, that is simply not good enough."

The former governor has it all backwards, said Marty Rutherford, Palin's deputy commissioner of natural resources, when contacted later.

Murkowski was willing to strike a deal with oil companies at any cost, while Palin wants Alaska to get its equal share, she said. "(The Palin) administration is paying attention to commercial reality and the people's interests, versus the last one where they were willing to trade incredible amounts of value without getting anything in return."

As for Point Thomson, it was a Murkowski appointee who first revoked Exxon's leases, and the company has blown its chance to develop the field after decades of inactivity, she said.

Talking to the chamber about Alaska's role in a struggling world economy, Murkowski sounded a lot like he did as a U.S. senator -- a job he held for 22 years -- and during his one term as governor.

He delivered a strictly pro-business, pro-development message, including:

• A call to loosen cruise ship environmental regulations that voters approved in 2006.

• Predictions that less federal money is on the way to Alaska, but that President-elect Barack Obama would not veto an effort to drill for oil in ANWR.

• A warning that the Flint Hills Resources oil refinery in North Pole is in danger of closing down, and that one solution might be for the Alaska Railroad to buy the plant and lease it to an operator.

As governor from 2002 to 2006, Murkowski made a pipeline that would deliver Alaska's "stranded" natural gas to the Lower 48 his signature pursuit.

The three major oil companies operating in Alaska wanted to know tax rates before they would build.

Palin instead defined the terms of the project and asked companies to bid on it, awarding the license to a different company, TransCanada Corp.

Palin's plan calls for the state to spend $500 million to reimburse TransCanada for planning expenses. Instead, the state should acquire part-ownership of the pipeline, Murkowski said:

"There's nothing like having a seat at the table."

That's a bad idea, Rutherford said. She said it would put the state on the hook to pay for things like maintenance and upgrades but wouldn't buy Alaska a strong decision-making stake among the owners.

On a more personal note, Murkowski's former chief of staff, Jim Clark, pleaded guilty in March to receiving illegal campaign help from the Veco Corp. for Murkowski's failed re-election bid in 2006.

Murkowski said Monday that Clark made a "very significant mistake" but that he didn't know what his lieutenant was up to at that time.

Was Clark's case the end of the investigation into his administration?

"Why, I don't have any idea. I've never been contacted by anyone, ever, personally," he said.

Murkowski said he voted for Palin and running mate John McCain on Nov. 4. Asked whether he'd vote for her for president, Murkowski said, "We'll have to see what the option is, before we jump into that trap."

As for what he's been up to since leaving the public eye, Murkowski said he and his wife Nancy built a beach house in Wrangell.

"We've got a boat there, and we've got a hot tub on the beach ... We travel a little bit and we visit our grandkids a little bit," he said.

Find Kyle Hopkins' political blog online at adn.com/alaskapolitics or call him at 257-4334.

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