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Three gas pipeline bills in Legislature
Bills to add Fairbanks spur to AGDC's charter language in both House and Senate; Senate has bill for Alaska Gasline Finance Corp. Kristen Nelson Petroleum News
Rep. Will Stapp, R-Fairbanks, introduced House Bill 119 Feb. 26, adding language to the statute governing Alaska Gasline Development Corp. which reads "an in-state natural gas pipeline advanced under this paragraph must include a direct spur line to the City of Fairbanks and the Fairbanks North Star Borough." A companion bill, Senate Bill 114, sponsored by Sen. Mike Cronk, R-Tok, Northway, was introduced in the Senate Feb. 28.
SB 125, introduced by Sen. Robert Yundt, R-Wasilla, on Feb. 28, establishes the Alaska Gasline Finance Corp. to "develop and have primary responsibility for financing a natural gas pipeline in the state." That bill has not yet been heard.
HB 119 was referred to House State Affairs and House Resources, and has been heard twice in House State Affairs, March 6 and March 11. The next hearing date had not yet been published when this issue of Petroleum News went to press.
HB 119 In his sponsor statement for HB 119, Stapp said when AGDC was established in 2010 with passage of HB 369, legislative findings specified that the state's natural gas sound, as a priority, be made available in the state. SB 138 broadened AGDC's purpose to advancing a liquefied natural gas project.
He cited 2020 census data demonstrating that the Fairbanks North Star Borough is the largest community in Interior Alaska and Fairbanks the second largest city in the state.
The current project, he said, bypasses Fairbanks, and AGDC, he said, has maintained that development of a Fairbanks spur line would need to be evaluated.
"HB 119 simply ensures that the development of a spur line to the City of Fairbanks and the Fairbanks North Star Borough be included in the Alaska LNG project by enshrining such language in the charter governing AGDC."
Comments The Fairbanks North Star Borough passed a resolution Feb. 27, supporting a gas pipeline from the North Slope, "including a Fairbanks connector, to provide economic, environmental, and energy benefits to Fairbanks and the Interior region."
A letter from Golden Valley Electric Association President Travis Million supported passage of HB 119, calling natural gas a key legislative priority for GVEA.
"HB 119 sends a strong signal to private and public entities involved in the AKLNG discussions that Interior Alaska must no longer be a bystander, or secondary beneficiary of the project," Million said.
Elena Sudduth, general manager of the Interior Gas Utility, said in a March 5 letter of House State Affairs that it supports HB 119, which, it said, ensures "that Fairbanks, North Pole, and the greater Interior are included in the action taken to ensure Alaska's energy future" by mandating a direct spur to Fairbanks.
The standalone project AGDC President Frank Richards responded to committee questions on AGDC's current project.
AGDC's original purpose, Richards said, was advancing an in-state natural gas pipeline, referred to as the standalone project, providing natural gas to Fairbanks and Southentral.
The Legislature provided funding for permitting that project and to do design work including a lateral line to Fairbanks, some 32 miles, with the main line connecting to the Enstar line in Southcentral, work the corporation did from 2012 through 2015. Front-end engineering and design work was completed, Richards said, and rights of way were granted for both the mainline and the lateral to Fairbanks.
In 2014, he said, the Legislature also gave AGDC responsibility to represent the state in the LNG project, so it had both projects in 2014 and 2015, but in the 2015-17 timeframe, the Legislature directed that all funds available were to be directed to the Alaska LNG project, so the in-state project was put on the shelf.
Richards said AGDC is now working with Glenfarne on taking over as private developer for Alaska LNG. AGDC has also had a lot of interest from Alaska pipeline companies in developing the lateral line to Fairbanks, he said.
Asked why the work done on the in-state line couldn't be rolled into the Alaska LNG project, Richards said the in-state work was done under an Army Corps of Engineers environmental impact statement, while the AKLNG project includes the plant on the North Slope, the pipeline and the liquefaction facility and that work has been done under the Federal Energy Regulatory Commission. To include the in-state line would potentially open up the environmental process again.
That, he said, is why AGDC is looking at two entities, one developing the Alaska LNG project and the second the lateral line.
As to why the lateral wasn't part of the original AKLNG project, Richards said that work was begun when ExxonMobil, BP and ConocoPhillips were joint development partners with AGDC, and that project allowed for offtake points. It was not a choice made by AGDC, he said, but by the lead developer at the time.
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