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Governor Congratulates Alaska's Congressional Delegation
for Winning Passage of Key Gas Line Incentives


October 12, 2004

Juneau, Alaska - Governor Frank Murkowski congratulated Alaska's Congressional Delegation for winning passage in the U.S. Congress of key federal incentives to a natural gas pipeline project on Monday.

"Senators Ted Stevens and Lisa Murkowski, along with Congressman Don Young have succeeded at the Herculean task of delivering on federal legislation that was critical in moving this project forward," Governor Murkowski said. "These federal incentives will go a long way in helping efforts to build the pipeline and secure the benefits of this important project for all Alaskans."

Alaska's Congressional Delegation was able to insert key natural gas pipeline provisions in both the Fiscal 2005 Military Construction Appropriations Conference Committee report and a bill addressing corporate taxes.

Rep. Young and Sens. Stevens and Murkowski worked tirelessly in the closing days of consideration to win tax incentives and regulatory provisions that pipeline builders have said are essential. The measures:

  • Provide a federal loan guarantee provision of $18 billion, or up to 80 percent of capital costs, to make the project more attractive to the eventual pipeline builder.
  • Direct the Federal Energy Regulatory Commission to quickly permit the project once certain requirements are met, and provide for expedited judicial review.
  • Designate FERC as the lead agency for the National Environmental Policy Act process and requires a single environmental impact study.
  • Allow pipeline owners "accelerated depreciation" to claim construction costs on their taxes over seven years instead of 15 years. They also makes a proposed North Slope gas conditioning plant eligible for a tax credit worth $295 million over the same period.
  • Create a federal coordinator within the executive branch to provide a single point of contact between federal agencies and pipeline officials.

The state is currently in negotiation with the major oil producers and TransCanada Corp. and is beginning negotiations with Enbridge Inc. The state is also working with the Alaska Natural Gas Development Authority and the Alaska Gasline Port Authority. The federal incentives could apply to any economically viable pipeline project.

"Our Congressional Delegation has delivered on federal legislation that removes a large roadblock to our efforts to make progress in the commercialization of our gas resources," the governor said. "They have helped orchestrate an unprecedented federal response to what is regarded as the largest private sector construction project ever undertaken. If we're successful, it will mean jobs for Alaska families and a reliable source of energy for the American people."

Both the military appropriations bill and the corporate tax bill are now on their way to President George W. Bush, who is expected to sign both.


Source of News:

Office of the Governor
Web Site



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