Anchorage Daily News

JUNEAU -- Ted Stevens minced no words with Alaska's Legislature: Get moving on the natural gas pipeline project, he told the 60-member group Tuesday.

There was no ultimatum from the Senate's longest-serving Republican, but the sense of urgency was abundantly clear.

"The window of opportunity of that gas line is rapidly closing," Stevens told the state lawmakers. "Time is of the essence if our pipeline is to compete with foreign (liquefied natural gas) and domestic sources such as the Marcellus Shale gas (in the Appalachian region)."

The 84-year-old Stevens spoke with candor and humor, starting off with a few jokes and stories dating to his days in the state Capitol when he was House majority leader.

His relaxed delivery hardly looked like it came from a man dogged for nearly a year by a federal investigation.

The FBI is looking into whether Stevens accepted inappropriate gifts from Bill Allen, the founder of oil-services firm Veco Corp. Allen has pleaded guilty to bribing lawmakers and said he paid employees to renovate the senator's home.

Stevens would not take questions about the investigation. He has long said his refusal to answer questions is based on advice from his lawyers.

Stevens' message to the Legislature was wide-ranging, touching on issues such as federal earmarks, the role of Native corporations and the state's strong military presence.

But the gas line underscored his broad message.

So far, the state believes it may have found the company that can build a pipeline to ship 35 trillion cubic feet of North Slope reserves into Midwest markets.

It's TransCanada, which Gov. Sarah Palin has said conforms to the state's Alaska Gasline Inducement Act. The state's public comment period ends March 6.

Houston-based Conoco Phillips says it's got a plan outside the state's bid requirements if the state would just negotiate what it calls fiscal certainty.

This sets long-term tax and royalty terms for the North Slope leaseholders who have wanted these terms negotiated before a pipeline license gets awarded.

Stevens stressed addressing fiscal certainty, but he stopped short of saying Palin should return to the bargaining table with producers Conoco Phillips, Exxon Mobil and BP.

"I don't think anyone is going to build it until they know what terms are going to exist by the time it's complete," Stevens said after his speech.

"We are right at the point that it may not be built unless we can find a way to assure there is fiscal certainty," he said.

Stevens wouldn't characterize the state's movement on the pipeline, whether it's progressing or stalled. He simply stressed the urgency.

Stevens made no threats, veiled or otherwise, but after his annual address, he warned of federal intervention as a last resort under the Alaska Natural Gas Pipeline Act.

"It's entirely possible the time may come when Congress may have to act and fulfill the Alaska natural gas line pipeline concept itself," he said.

"There is a provision that does authorize going ahead with federal supervision of construction. What you suggest is entirely possible if the delay is too long."

Stevens added he doesn't expect Congress to intervene on behalf of the state or assist a company awarded the license, other than what the law already permits.

The urgency was not lost on House Speaker John Harris, R-Valdez, who has been hosting public hearings for oil and gas, as well as pipeline companies this session.

"I think the longer it takes Alaska to fill the existing marketplace, the easier it will be and the sooner it will be that somebody else will fill that vacancy," Harris said. "The market we are looking for in the Midwest will probably be filled by someone else.

"Now is the demand for gas going to grow fast enough in this country to find a spot anywhere? I don't know the answer to that, but the world market will still be there; it just might not be in the United States."

Alaska Senate President Lyda Green, R-Wasilla, said Stevens' message was still that of encouragement rather than a mandate.

"I think he sent some candid facts in his message," Green said. "I thought his answers were succinct, direct and no equivocation."

ADVERTISEMENT