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Balash carries election water for Parnell in a bucket full of holes

  • Author: Craig Richards
  • Updated: June 29, 2016
  • Published October 30, 2014

Alaska Department of Natural Resources Commissioner Joe Balash recently submitted a political commentary on behalf of Gov. Parnell attacking Bill Walker's efforts on LNG (and Bill personally). It is unfortunate that Parnell continues to decline Walker's invitation for a one-hour statewide live TV debate on the gas line. Rather, it seems he prefers to rely on state employees to do his campaigning on this critical project. I know from years of practicing law with Bill that, if elected, he will speak directly to Alaskans.

The Alaska Gasline Port Authority was formed by the voters of the three Alaska boroughs in 1999. Its mission was to build or "cause to be built" a large volume gas line to tidewater. Toward that goal, it worked with companies including Bechtel, Sempra LNG and Mitsubishi Corp., to name a few.

The port authority was able to obtain cost estimates, financial modeling and market relationships that culminated in bringing markets to Alaska on numerous occasions. Only a small amount of its funding came from member municipalities; overwhelmingly, these efforts were paid for by LNG buyers who wanted to purchase Alaska's gas.

On numerous occasions, the port authority and LNG buyers were unable to get Parnell to engage. Mitsubishi tried to meet with the governor seven days after the Fukushima earthquake. No engagement with the governor occurred, and they ultimately invested billions of dollars in LNG projects in British Columbia and the Lower 48. Consider that the port authority was able to successfully bring the markets to Alaska for 100 percent volume needed under AGIA in September 2012. At the same time, Resource Energy Inc., on behalf of Japanese buyers, also sought to purchase LNG volumes through AGIA large enough for a full project. Yet Parnell failed to understand the significance of the world's largest LNG buyers seeking to buy Alaska gas.

Instead, Parnell was committed to a Canadian project until recently. Alaska wasted more than four years pretending a Canadian project was real. Even when Parnell changed directions toward LNG in advance of this election, he did so in a politically expedient way by starting over. He did not build off the AGIA framework or incredible market responses LNG had received, instead starting over as an excuse to put in charge of the process the very companies (Exxon Mobil, BP, ConocoPhillips) that are Alaska's biggest competitors, with competing projects around the world.

I personally witnessed Bill's many efforts to advance an LNG project with the producers, state, federal government, LNG buyers and others. Bill has done everything he could possibly do to build the gas line without having the ultimate decision-making authority the governor of the state of Alaska possesses. Bill's experience includes directly engaging the market, not allowing the North Slope leaseholders to control project timing to extract concessions from the state, and utilizing an open process that encourages -- does not eliminate -- global competition. In short, Bill knows success will require the state to act like the resource owner it is and be in control of the process, while at the same time working collaboratively and inclusively with all stakeholders.

Balash's attacks on the funds paid to our firm are also misguided. Although he does point out that Bill has contributed his time to the port authority for many years, he attacks Bill for monies paid our firm by the City of Valdez. About 90 percent of those funds are for the litigation to bring the value of TAPS up to its full and true value. I have not had time to track the numbers but I estimate a bit less than half of the amount is for experts paid through our firm with no markup. It varies but the roughly $1 million-$1.5 million annually paid by Valdez for legal services for the TAPS value litigation supports overhead, five-plus attorneys including myself, two to three paralegals and office support staff.

Balash also fails to address that all three Alaska municipalities (North Slope Borough, Fairbanks North Star Borough and City of Valdez) expended like amounts related to the TAPS assessment. The effort has raised the value of TAPS to close to its full and true value, with the state of Alaska directly benefiting by approximately $1 billion to date. The TAPS litigation has been an overwhelming success for those communities, Anchorage (which receives millions more in taxes), the state and local taxpayers throughout the state who have seen their property taxes go down.

Bill Walker is the right man to lead Alaska. He has a clear vision on energy policy, and the knowledge and strength to make projects happen. I believe all Alaskans will be well served if he is elected governor.

Craig Richards is a lifelong Alaskan, originally from Fairbanks. He practices law with independent candidate for governor Bill Walker at Walker Richards, LLC in Anchorage and has a B.S. in finance from the University of Virginia and an MBA from Duke University.

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, email commentary(at)alaskadispatch.com.

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