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Enbridge Applies To Negotiate Contract Terms for
Gas Pipeline Under Stranded Gas Development Act


May 05, 2004

Juneau, Alaska - The Murkowski administration has received an application under the state's Stranded Gas Development Act from Enbridge Inc. to negotiate fiscal terms for a contract to build a natural gas pipeline from Alaska's North Slope to the Yukon border. Enbridge is a major Canadian oil and gas transportation company, operating more than 9,000 miles of natural gas pipelines in the US and Canada.

"We are pleased to see the application by Enbridge, which underscores that the time is right for this project to come together and be built," Murkowski said. "We especially appreciate the company's recognition that a project of this magnitude will require a cooperative venture from a number of experienced, established energy companies in order to make it happen. We look forward to working through the details of a draft contract with Enbridge that we can put before the Legislature for its review and consent. This is one more significant step forward in this project, and I am glad they have taken that step."

Under the Stranded Gas Act, qualified sponsors must apply to negotiate a contract that defines fiscal terms, such as royalties, severance taxes, property taxes, payments in lieu of taxes, etc., that might be considered. It can also include such non-fiscal terms as Alaska hire agreements, access to put gas into the line, as well as where local communities might take gas off the line.

The administration's SGDA negotiating team is currently in negotiations with the major North Slope producers, BP, Conoco-Phillips, and ExxonMobil. It also has received and is reviewing an application from the Alaska Gasline Port Authority, a consortium made up of the City of Valdez and the Fairbanks North Star Borough. And it is anticipating a fourth application from TransCanada Corporation, which will be applying under the terms of an MOU signed with the state on April 19.

Murkowski said he is optimistic that negotiated draft contracts can be transmitted to the Legislature before the end of the year.


Source of News Release:

Office of the Governor
Web Site



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