Oil Sands Truth: Shut Down the Tar Sands

Ted Stevens Trying to Streamline Alaska Highway Pipeline

This pipeline will also, along with the Mackenzie Gas Project, be used at least in large part to feed the energy needs of the tarsands in Alberta. To state that since the energy would be consumed in the US means it really isn't shipping out American gas to non-American sources would be a direct admission of the irrational yet oil-dependant need to go after the tarsands, would it not?

That could go bad in a lot of ways. Let's just talk about something else, like sending the gas to the lower 48. We could believe them.

But that ignores the bidders public, "investor read here" plans:


The pipeline systems in Alberta they refer to are proposing a connector over the top, to the tarsands. Alaska knows well with an oil crunch coming, this cannot be delayed.


Lawmakers seek watertight gas bill

SORE LOSERS? Dodging lawsuits may not be possible, a couple of legislators say.
The Associated Press
Anchorage Daily News: March 24, 2007

JUNEAU -- U.S. Sen. Ted Stevens made his point abundantly and repeatedly clear to Alaska lawmakers: Keep the natural gas pipeline legislation out of the courts, or risk prolonged delays in getting a pipeline built.

The state and the oil and gas industry have reaped tremendous rewards from decades of oil exploration in Alaska, but the two sides still are dogged by a history of differences, including a few pending disputes in court and with federal regulators.

Some state lawmakers are wary that a bidder who fails to win the right to build the multibillion-dollar pipeline will play the role of sore loser and take the case to court.

Already, Sen. Tom Wagoner, R-Kenai, who serves on the Senate Resources Committee, had said he wants to insert an amendment in Gov. Sarah Palin's Alaska Gasline Inducement Act that would require applicants to waive their right to certain appeals.

"There may be some legal problems with that," Wagoner said, acknowledging the idea stems from Stevens' warning during his address to lawmakers this week. "But we think it's worth exploring and worth putting in there as an amendment and creating some discussion about it. It's very critical to get this pipeline on the way and get it completed as soon as possible."

The stakes -- billions in revenue to the oil companies, plus tax income and royalties to the state -- are too high for both sides to be locked up in protracted legal battles.

"Money is more valuable now than later," said Patrick Martin, minerals law professor at Louisiana State University.

"If you have to wait another 20 years, it will not be nearly as much as having money in hand today either for companies or the state."

But crafting what appears to be the most legally sound legislation may not be enough, said state Sen. Hollis French, D-Anchorage, who serves as chairman of the Senate Judiciary Committee.

"It's almost impossible to construct a deal that doesn't result in a winner and a loser," he said. "There is probably nothing you can do from having a loser taking you to court and saying, 'You didn't give us a fair shake and a fair opportunity.' "

Palin's bill, known by the acronym AGIA, is designed to stimulate competition for the right to build a pipeline that could be statewide or reach the Lower 48 through Canada. It's also aimed generating future exploration beyond the 35 trillion cubic feet of known reserves.

This bill officially sets aside efforts from last year's administration, which had a pipeline and fiscal deal in principle with North Slope producers Exxon Mobil Corp., BP and Conoco Phillips, who must now start over in a more competitive playing field.

French, an attorney, said lawmakers will remain mindful -- but not fearful -- of lawsuits filed by those not getting any part of, or the desired role in, this multibillion-dollar project.

"I'm not afraid of court; you shouldn't be afraid of court," he said. "You have to believe in the strength of your arguments and the legality of arguments.

"I wouldn't want to shy so far away from the legal process that we give up valuable rights and valuable resources just so we avoid a few bruising days in courts."

One legal issue confronting lawmakers concerns whether a 10-year tax freeze for producers willing to be among the first to commit gas to the pipeline violates Alaska's constitution.

Last year, lawmakers raised the same issue over a 30- and 45-year tax freeze for oil and gas, saying it falls under the section that states, "The power of taxation shall never be surrendered."

In a letter to French and House Judiciary Chairman Rep. Jay Ramras, R-Fairbanks, Alaska Attorney General Talis J. Colberg says AGIA's inducement is more narrowly tailored than last year's restricting "provisions antithetical to state sovereignty," and said the provision would "survive scrutiny."

French said scrutinizing this provision will be a priority for the Senate Judiciary Committee, which features three members with law degrees, one member steeped in industry knowledge and a state senator who serves on all three committees holding AGIA hearings.

"My own personal take is that I don't want to walk into a legal dead end," French said. "I don't want to take us down a course that results in a deal that we strike being tossed out because of some constitutional problem embedded in the statue or the contract."

The job of limiting litigation doesn't just rest with the Judiciary Committee, as some of these items are being covered in the House Oil and Gas Committee and Senate Resources Committees.

But the Judiciary Committee will likely give AGIA the strongest legal vetting.

French said he also plans to examine several other sections of AGIA to determine whether it could pass a legal test, including if the state could defend the clause stating that once a license is issued to build the pipeline, all court challenges must be filed within 90 days.

And before AGIA reaches the House and Senate for a full vote, 39 lawmakers -- or nearly two-thirds of the Legislature -- who sit on the six committees will have publicly reviewed AGIA.

"The more people who touch it, the better," French said. "You'll have fewer surprises and people with have a better comfort level with this piece of legislation."

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