US Alaska governor unveils plan for gas pipeline

Gov. Sean Parnell on January 10 announced a new way forward on a long-hoped-for natural gas pipeline that includes scrapping the terms of a 2007 law he says no longer works well for the situation, AP has reported.

In a major policy speech in Anchorage, Parnell said the state and Canadian pipeline builder TransCanada have agreed to terminate their involvement under the Alaska Gasline Inducement Act. He made clear, however, that TransCanada would remain a partner in the project, just under new terms.

Parnell said he would seek legislative approval for the state to participate in a new commercial agreement with TransCanada; the North Slope's three major players, Exxon Mobil, BP and ConocoPhillips -- and the Alaska Gasline Development Corp. He said he expected a set of terms to be signed soon.

Natural Resources Commissioner Joe Balash called the commercial agreement a "broad roadmap" and statement of intent. He said in an interview that legislation would have to be passed to accomplish what is being contemplated and the state plans to enter a separate, more narrowly defined agreement with TransCanada for pipeline services.

The terms of the inducement act will remain in force for the time being, though the parties envision transitioning into the new arrangement once enabling legislation is passed, Balash said.

"Nobody's letting go of the rope just yet," he said, but he noted the state and TransCanada had "pre-agreed" to make the transition. A TransCanada spokesman said the company would continue working to advance the pipeline project.

Copyright: USA Today, 2014