by Senator John Cowdery
July 19, 2006
The Murkowski administration has negotiated a contract with the three Prudhoe Bay leaseholders to build a pipeline along the Alaska Highway delivering the gas to the Midwest where there's enough demand to make the pipeline profitable under several gas price scenarios.
Election year politics also make the gasline contract a political piñata. The Alaska Gasline Port Authority and several political candidates are taking cheap shots at the contract and everyone who disagrees with them. I want to clear up some of the misinformation that's out there.
Yes, the contract allows for in-state use of the gas. Four take-off points at Fairbanks, the Yukon River, Delta Junction and Glennallen are possible. A spur line to Valdez can even be built.
Just because the pipeline will terminate in Alberta or Chicago doesn't mean Alaskan communities, wanting access to the gas have to pay rates that reflect the cost of shipping to those far away locations.
The Federal Energy Regulatory Commission will regulate the pipeline and create mileage sensitive rates. In other words, the monthly gas bill for a homeowner in Fairbanks will be based, in part, on the cost of shipping the gas to Fairbanks, not Canada or Chicago.
FERC rules mandate in-state use of natural gas and a study on in-state usage will be performed before gas starts flowing. The producers are also required to cooperate with Enstar and other companies that provide natural gas service in Alaska.
A recent opinion column by gubernatorial candidate Tony Knowles called for a project labor agreement with construction unions to be part of the contract. This is the same candidate who was governor for eight years and couldn't even get the producers to sit down at the bargaining table to talk about a gas pipeline.
Knowles claims a project labor agreement puts Alaskans at the front of the line for pipeline construction jobs. That statement just floors me. Project labor agreements actually lock thousands of Alaskans out of pipeline construction jobs and here's why:
The Alaska Department of Labor says our state has about 20,000 construction workers. Only 6,000 of them are unionized. In fact, I used to be a union member myself, I held a union card with the Carpenters Local 1281 and Operating Engineers Local 302.
A project labor agreement means only unionized construction workers get pipeline construction jobs. There simply aren't enough of them to build the pipeline and other projects around the state at the same time.
A project labor agreement will lockout thousands of rural residents from pipeline jobs because virtually none of them are unionized. The gas pipeline is the golden opportunity for villagers to provide for their families and we need to make sure they get that opportunity.
So who will get those remaining construction jobs? Not Alaskans. Thousands of union members from the Lower-48 will be brought up to work on the pipeline while their paychecks go back to Oklahoma and Texas.
The contract also gives the state a seat at the decision making table by having a 20 percent ownership in the pipeline so we have a strong voice on how the gas line is managed and operated, something we don't have now with the Trans Alaska Oil Pipeline.
Critics claim the state will be a minor player in operating the pipeline because the producers will dominate the management process. That conspiracy theory assumes all three producers will agree on every issue and ignores the fact those companies are intense competitors both here in Alaska and around the world.
Time is running out. Federal
regulators are warning us that foreign countries will meet America's
growing demand for natural gas if Alaska doesn't ink a deal with
the producers very soon. Even though a small area in Anchorage
elected me, I try to look out for the whole state Tony
Knowles should be doing the same thing.
About: Senator John Cowdery
(R) is a member of the Alaska State Legislature representing
District O - Anchorage.
and do not necessarily reflect the opinions of Sitnews.