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MidAmerican Natural Gas Pipeline Application Accepted

 

January 29, 2004
Thursday - 12:30 am


Juneau - Governor Frank Murkowski announced Wednesday that the state has reviewed and accepted the application submitted last week by a consortium of companies, led by MidAmerican Energy Holdings Company, to enter negotiations on fiscal and tax issues related to building a natural gas pipeline from the North Slope to Canada.


photo...

Ken Thompson, president and CEO of Pacific Star Energy; David Sokol, chairman and CEO of MidAmerican Energy Holdings Company; Gov. Frank H. Murkowski; and Carl Marrs, president and CEO of Cook Inlet Region, Inc., pose with the shovel that the Governor presented to them last Thursday in Fairbanks, symbolizing their mutual desire to get to work on a pipeline bringing North Slope natural gas to Lower 48 markets.
Photo courtesy Office of the Governor....


A letter, signed by Commissioner of Revenue Bill Corbus and Commissioner of Natural Resources Tom Irwin, has been sent to MidAmerican, notifying the company and its partners that the application conforms with the requirements of the state's Stranded Gas Act, and is accepted.

"This clears the way for negotiations to begin on a draft contract," Murkowski said. "We will hold preliminary talks with the companies immediately, with formal negotiations following shortly thereafter. We believe the consortium of companies led by MidAmerican is highly qualified to construct the project they have proposed, and we expect to negotiate with them from that basis."

The Stranded Gas Act allows the state to negotiate with qualified sponsors on fiscal terms, such as taxes and royalty adjustments, as well as other pertinent terms, such as Alaska hire, off-take points, and access, with respect to development of a natural gas transportation project. And, while the Act does not require the construction of the gas pipeline, the state can condition certain incentives on work requirements.

The consortium led by MidAmerican includes Cook Inlet Region, Inc., as well as Pacific Star Energy, of which 12 of the 13 regional Native corporations are partners. MidAmerican is a privately-held company owned in substantial part by Berkshire-Hathaway. Pacific Star Energy is a local Alaskan start-up led by Ken Thompson, a former Arco Alaska executive. Their proposal would construct an open access, 48 inch, 4.5 bcf per day pipeline from Prudhoe Bay to the Canadian border near Beaver Creek, where it would connect with a pipeline taking it into Alberta and existing natural gas distribution lines. The companies are targeting the end of December 2010 to have gas in the line.

Murkowski said he hopes to have a draft contract negotiated in time for the Legislature to consider and approve it before adjourning in mid-May.

 

 

Source of News & Photograph:

Office of the Governor
Web Site


 

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