For a guy with no natural gas, no money, no support from North Slope oil producers and no legislative backing worth a hill of beans, Gov. Bill Walker is clinging to dreams of building a gas line on his own terms like a shipwreck survivor clutches a life ring.
It smacks of deja vu all over again. He did the same years ago, with the Alaska Gasline Port Authority, and is hard at it again, even surrounding himself with people he worked with in those days. There was, it should be noted, no gas line built then; there may not be one built now if he gets his way. Some fear that in chasing his dream he may be tossing out the baby with the bath water.
This time, he says, all he needs to snap the oil industry into line on the proposed $65 billion Alaska LNG project is unfettered access -- an open checkbook, without legislative approval -- to the unspent $180 million of the more than $400 million appropriated over the years for the Alaska Gasline Development Corp.
The Legislature, as you can imagine, rightfully is antsy about that.
The rest of the $400 million is gone, underwriting preliminary work on the Alaska Stand Alone Pipeline, envisioned by lawmakers as a small, in-state, backup gas line from the North Slope. The idea was that if North Slope producers bailed on building a bigger line, ASAP -- its capacity limited to 0.5 billion cubic feet of gas daily -- would be ready to go with a boosted capacity.
Walker complained it was too small, too uneconomical. He needed something bigger.
He sees ASAP as a multibillion-dollar crowbar to spur the Alaska LNG project. He wants the $180 million to expand ASAP for more leverage in negotiating fiscal terms for the mega-project being pieced together by BP, ConocoPhillips and ExxonMobil -- along with the state of Alaska and TransCanada.
Without it, he told Alaska Dispatch News, he would be negotiating with "both hands tied behind my back."
Meanwhile, in boardrooms across the land, executives spending hundreds of millions of dollars of shareholders' money to bring the $65 billion Alaska LNG project on line -- and who actually do have money and support and gas -- are trying to figure out what Walker is doing.
ExxonMobil says Walker's expanded ASAP plans directly compete with the larger project, creating confusion and uncertainty among regulators, potential buyers and investors about Alaska's intentions.
The Legislature certainly is unimpressed. It approved and sent to Walker's desk House Bill 132, which would block the gas line development corporation overseeing ASAP -- along with Alaska's interest in the producer-backed effort -- from working on the upsized line. The governor threatens a veto.
Walker's antipathy for the industry is nothing new. Alaska's agonizing, on-again, off-again drive to move North Slope gas south has a long, often rancorous history. Gerald Ford signed the Alaska Natural Gas Transportation Act into law in October 1976, and lost the election 11 days later, leaving Jimmy Carter to pick a pipeline route from three being pitched at the time. He also decided North Slope producers could not own an interest in the pipeline.
Unsurprisingly, nothing got built. Cutting out the industry was dumb. In 1981, President Ronald Reagan reversed Carter. The fight goes on. Gov. Frank Murkowski included producers in his effort, and got close. Sarah Palin's ill-fated Alaska Gasline Inducement Act edged them out. Gov. Sean Parnell included them in this try. Walker sometimes appears itchy to sideline them.
In itself, that is amazing. There are immutable gas line facts. The Legislature gets them. The industry gets them. Investors and financial institutions get them.
No line will be built in Alaska without the industry. It has the gas. It has the ability to obtain financing. It is chock full of people who know the business, know how to build and run pipelines. It has a fiduciary responsibility to its shareholders. It is unlikely to be swayed, frightened or cajoled into being stupid or rolling over on fiscal terms by a 36-inch pipeline or a guy running a state with none of the above.
Rather than trying to yank the companies to heel and bullying lawmakers, why not work with them to present the market with a united, determined front? Ego, after all, takes you only so far.
If Walker continues sowing confusion and uncertainty, it will be a giant step backward -- and Alaskans will be looking for their own life rings.
Paul Jenkins is editor of the AnchorageDailyPlanet.com, a division of Porcaro Communication.
The views expressed here are the writer's own and are not necessarily endorsed by Alaska Dispatch News, which welcomes a broad range of viewpoints. To submit a piece for consideration, e-mail commentary(at)alaskadispatch.com