Producers Reject Alaska Pipeline



A cadre of energy companies have told Alaska lawmakers that they would not participate in building a natural gas pipeline from Alaska's North Slope because its legislation makes too many demands without granting much in return.

Representatives from Exxon Mobil Corp., BP and ConocoPhillips say they will not participate in the pipeline, which would carry North Slope natural gas to the Lower 48, because the Alaska Gasoline Inducement Act would not generate competitive bids for constructing the pipeline.

The brainchild of Gov. Sarah Palin's (R) administration, the act would allow producers and independent pipeline companies to vie for the right to build a pipeline, but it requires them to build the pipeline along a certain route and adhere to a construction timetable and deadline as part of the license application.

Producers say they want broader objectives.

"AGIA, as it's written today, does not encourage market-based competition due to its prescriptive nature," said Exxon Mobil's Marty Massey, who oversees commercialization of the company's Alaska gas resources. "We have consistently advised the Legislature and the administration that AGIA, in its current form, will not encourage competitive proposals and will not result in a commercially viable project" (AP/Houston Chronicle, May 3).

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