SitNews - Stories in the News - Ketchikan, Alaska


Monopoly in Anchorage Fuel Market Nixed By Attorney General


June 22, 2016
Wednesday PM

(SitNews) Anchorage, Alaska - In January of this year, Senator Bill Wielechowski (D-Anchorage) formally requested that Attorney General Craig Richards fully investigate the sale of the Flint Hills gas storage facilities in Anchorage to Tesoro Alaska for any anti-trust implications, and to prevent Alaska’s gas market from being dominated by one company.

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At the conclusion of the six month investigation, the Alaska Department of Law determined that Tesoro’s acquisition of Flint Hills Resources’s tank farm would limit the ability of competitors to import fuel through the Port of Anchorage and impair competition in markets for some fuel products, including gasoline.

Tuesday, Attorney General Richards announced that the State of Alaska reached an agreement with Tesoro Alaska Company that requires Tesoro to sell a petroleum fuel terminal at the Port of Anchorage in order to preserve competition in Alaska fuel markets. To address this concern, Tesoro has agreed to sell its Terminal 1 to a qualified buyer.

Tesoro reached an Agreement with Flint Hills Resources (FHR) last year to purchase most of FHR’s Alaska fuel storage assets, including FHR’s storage facility at the Port of Anchorage. This facility contains about 580,000 barrels of useable storage capacity plus a rail loading facility. Tesoro also owns two storage facilities at the Port of Anchorage—Terminal 1 with 220,000 barrels of capacity and Terminal 2 with about 600,000 barrels of capacity.

“Allowing a new competitor into the Port of Anchorage will increase competition in this very constrained market,” said Chief Assistant Attorney General Ed Sniffen.

Sen. Wielechowski said, “I'm pleased by the diligent work of the Department of Law in coming to this decision. Gas price gouging has been an issue that Alaskans have been concerned with for many years now. Alaskans need to feel confident that the system isn’t rigged against them. While not a perfect solution, I'll be watching in the next few months, with cautious optimism, as Tesoro initiates the sale. I look forward to welcoming new competition into the Alaska fuel market.”

Sen. Wielechowski has been a consistent voice in the legislature seeking to have strong anti-price gouging language placed in statute to help shield Alaskans from the near monopolistic gas market in the state.

Alaskans often pay the highest gas prices in the nation, despite low taxes and the presence of local refineries. Previous requests to the governor had been denied, but the Senator welcomed this news, and is hopeful that competition in the market place, and an end to the monopoly in the gas market will result in a decrease in the price of gas for Alaskans.

Tesoro will have one year from the approval of the Consent Decree to sell the terminal. If it cannot find a buyer, it must lease the terminal.

The terms of the state’s agreement with Tesoro are set out in a Consent Decree filed June 21, 2016 with the Alaska Superior Court, and is subject to the court’s approval.

Public comments on the consent decree can be made within 60 days of filing the Consent Decree.

For more information on how to submit comments see section XII of the Consent Decree.


On the Web:

Consent Decree (PDF - 149K)


Edited by Mary Kauffman, SitNews


Source of News:

Alaska Department of Law

Office of Senator Bill Wielechowski (D-Anchorage)


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