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Gov. Murkowski Testifies to FERC on Pipeline Regulations
Proposed rules lack guarantees of in-state and explorers access


December 04, 2004

Alaska Governor Frank H. Murkowski testified before the Federal Energy Regulatory Commission in Anchorage on Friday on the need to amend proposed federal gas pipeline regulations to guarantee access and capacity.

"Unstranding the bountiful gas resources of Alaska's North Slope is the highest priority of my administration," Murkowski said. "I urge the FERC to require that a pipeline's open season process establish as clearly as possible the rules of the game for access."

mp3Regs Don't Address Access (80.6k mp3) - Governor Frank H. Murkowski says proposed regulations do not currently address state needs for pipeline access through the Open season process.

mp3FERC Urged to Ensure Access (56.3k mp3) - Governor Murkowski urges FERC members to include clear provisions for open access.

mp3Open Season Needed (122.9k mp3) - Governor Murkowski says that appropriate open season provisions would help the state encourage additional exploration and development.

Murkowski said the proposed "open season" regulations do not address in-state access to natural gas that will be important to all Alaskans. The open season regulations should go into detail on how those in-state needs are addressed, Murkowski said.

"In recently enacted legislation, Congress recognized that any approved Alaska pipeline project must have studied in-state needs, specifically including tie-in points along the pipeline for in-state access," Murkowski said. "The federal legislation also permits the FERC to order that the pipeline owners provide the state with 'reasonable access' to the pipeline for the in-state use of Alaska's royalty gas."

Proposed federal regulations on this issue currently do not address the issue of reasonable access, Murkowski said.

The regulations should also provide certainty to natural gas explorers that they will have access and the pipeline will have capacity for new gas supplies, Murkowski said.

Regulations should require the pipeline to have the capacity to accommodate all serious long-term bids in the initial open season and have a design that permits later expansion to accommodate newly discovered resources, Murkowski told the commission.

"Both of these issues are related to ensuring access to the pipeline for future natural gas supplies that can then be made available both in Alaska and in the Lower 48," Murkowski said.

The FERC held a special day-long hearing in Anchorage on Friday at the Assembly Chambers at Loussac Library to consider Open Season regulations. The commission intends to implement a final rule by Feb. 10.

The administration is negotiating with a consortium of oil producers _ which includes ConocoPhillips, BP and Exxon _ and with TransCanada. These two groups have applied to negotiate tax and royalty conditions of a gas pipeline under the Stranded Gas Act.

The governor is also currently talking with MidAmerican Energy Holdings Company, the Alaska Natural Gas Development Authority, the Alaska Gasline Port Authority, Embridge and Calpine outside the framework of the Stranded Gas Act.

"I can report that our Stranded Gas Development Act negotiations are advancing rapidly towards a fiscal certainty contract, which I intend to submit to the Legislature in its coming session. There is much work ahead, but also much promise," Murkowski said. "I look forward to working with the FERC as a partner in the development of an Alaska gas pipeline."


Source of News & Audio Clips:

Office of the Governor
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