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Giessel to Walker: Alaska has a place at the boardroom table

  • Author: Cathy Giessel
  • Updated: June 29, 2016
  • Published February 20, 2015

For the last four decades, Alaskans have waited to see their North Slope natural gas developed and brought both to Alaskan homes and global markets. Over the past three years, the leadership in the state House and Senate, and the previous Parnell administration, had worked tirelessly to get our state towards that objective. What has the result been?

Progress. Real, tangible progress. We have a gas project that has moved further than ever before in our state's history. Our state signed an agreement with the three major companies, ExxonMobil, BP, ConocoPhillips, as well as midstream operator TransCanada, to become a full-fledged partner in a major natural gas project, called Alaska LNG.

How large is this undertaking? If built, at a cost of $45 billion to 65 billion, it would be the largest private infrastructure project in North American history. The proposed liquefaction facility in Nikiski would deliver an output that compares to one-third the demand of a country the size of Germany.

We just like to do things bigger up here.

But for all these announcements, plans, studies, permits and the like, Alaskans want to really know: what's so different about this plan? That's a fair question: our history is littered with the ghosts of past projects left by the wayside: El Paso, Yukon Pacific, Denali. Their names evoke a reminder of our deflated aspirations.

The cliche expression is that money walks. If that is the case, then the Alaska LNG project looks like the real deal in so many ways. Just last year, the very year we ratified the general framework for the project under Senate Bill 138, Alaska LNG spent $82 million in Alaska on necessary fieldwork. The Point Thomson field, critical to the success of any gas project, has seen $2 billion invested in its construction. Seventy percent of that money stayed in Alaska. Point Thomson is on schedule to come online next year.

But our state wanted to take control of its destiny. We understood that Alaskan participation in this project was critical to its success. That's why you, your loved ones and every other Alaskan owns 25 percent of the Alaska LNG project. That's shareholder power. Our gas team is at the table for all negotiations. We are going to ensure domestic supply for generations, and revenue to help fund state services well into the future.

It's always good to have a backup generator, in case your normal plans fall through. That was why the Legislature created the Alaska Stand Alone Project, or ASAP. This project is a plan B, ready to go in case Alaska LNG doesn't come to fruition. The design of these two projects laid out in statute was done thoughtfully and carefully: no one wanted duplicated funding or work, and the backup plan was never meant to compete with the bigger diameter plan.

During this session, the legislature's resources committees have heard not only from the companies, but from the entities representing Alaska's interest in the Alaska LNG Project, namely the state Department of Revenue and Department of Natural Resources, as well as the Alaska Gasline Development Corp.

Their assessment was consistent and unequivocal: the projects are both on schedule and on budget. Alaska's interests are aligned with those of our partners. On top of that, the ASAP plan, the backup plan, is contributing to the success of the Alaska LNG Project by sharing massive amounts of high quality data.

In layman's terms, the projects are win-wins for Alaska.

We have a new governor. My belief is that Gov. Bill Walker sincerely shares the same goals with myself, my colleagues and the rest of the state: It's high time we got our gas to market. But when it comes to how that goal is achieved, his proposed road is a funny one.

The governor on the campaign trail called the Alaska LNG Project fatally flawed; said that Alaska didn't have a big enough stake in the project. Then the governor said the backup plan was redundant, that money was being spent twice. Once in office, the governor removed three highly qualified members of the gas line corporation's board, and told his commissioners on the board to not sign confidentiality agreements, all in the name of transparency.

So, one of the equal partners in one of the biggest construction jobs on the continent just opted out of knowing the project details. How does that serve the public interest?

Now, the governor has written an opinion piece, saying that the backup project should be prioritized. This was never the intent of ASAP: Having competing projects is not in Alaska's interest. It was always planned that one project or the other would come online, preferably the large-diameter Alaska LNG Project, but ASAP as a backup stood ready if that fell through.

On top of that, the governor says he wants market-driven forces rather than boardroom decisions driving a project. Markets want gas, plain and simple. Subjugating a project to the desires of buyers, who have every incentive to lower the price at which Alaska would sell, does not seem prudent.

Governor, with all due respect, the boardroom for this project is not in Houston or London; it's in your office. Alaskans are at the table; companies are allocating precious capital and manpower to this endeavor. The real question is, are you serious about seeing it through?

Sen. Cathy Giessel, a Republican, is chair of the Alaska Senate Resources Committee and represents District N, which covers East Anchorage and the Hillside as well as Turnagain Arm.

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)