Shock and dismay on gasline news

Wrongdoing allegedly derails Valdez route

By Lee Revis

Editor, Valdez Star

 

Bufflehead

Valdez Star photo This male Bufflehead Duck made a short appearance in the small boat harbor last weekend, during Saturday’s burst of sunshine. Male Buffleheads are distinguished by the white cap behind the eyes. The smallest of the diving ducks in North America, Buffleheads winter in coastal waters and nest inside trees near fresh water during the spring.

“Were we devastated? Absolutely – we were shocked,” said Dave Cobb, regarding the news that the application by the Alaska Gasline Port Authority to build a natural gas pipeline from the North Slope to Valdez was rejected by Governor Sarah Palin under the terms of the Alaska Gasline Inducement Act.

Last Thursday, Governor Palin announced that the TransCanada was the sole applicant out of five - including that of the Port Authority – that met all of the requirements under AGIA and no other plans to build a gas pipeline to develop the state’s natural gas would be submitted to the legislature for consideration. 

Palin called TransCanada’s application – which proposes a natural gas pipeline from the North Slope to Canada - the only plan that was “conforming and compliant.”

Not so says Cobb, a member of both the Valdez City Council and the Port Authority, telling the council during its Monday night meeting that the Port Authority’s application was rejected on a technicality.

“The data was there,” he told the council, “The application was complete.”

The Port Authority’s plan was rejected outright after state commissioners reviewing the applications asked all five entities seeking to build a gas pipeline for further information. According to a letter issued by state commissioners, they had asked the Port Authority for clarification on its pipeline capacity after finding a discrepancy in the data submitted.

Cobb said the Port Authority submitted the additional information, described as “beyond the ordinary.”

The state said the additional information was akin to a whole new application and did not clarify the discrepancy – whether the Port Authority’s pipeline would have a capacity of 2 billion cubic feet or 3 billion plus.

“They rejected our application on a technicality,” Cobb explained, “The application was submitted properly.”

In a late interview on Tuesday morning, Bill Walker, who is both the city attorney for the City of Valdez and the project manager for the Port Authority, described the application process as a cross between an Indiana Jones movie and an ax murder.  

“We were working with two significant Lower 48 energy companies” both pipeline and energy, he said, declining to name the companies – as of yet.  “They said they were going to submit a bid,” and the Port Authority gave the companies all of its technical data needed to submit an application under umbrella of the Port Authority. 

 “They decided not to submit a bid at the last minute,” said Walker, a move that proved disastrous when the unnamed companies allegedly delayed returning the data to the Port Authority in a timely fashion. 

That left the Port Authority with only three weeks to submit an application that Walker described in early December as 15,000 pages long, including 1,000 pages on the exact layout of where the pipe will lay.  

“We had all the stuff in,” Walker reiterated in Tuesday morning’s interview, describing how the Port Authority did not receive its data back from the companies until four days before the request for additional information was due to state officials – who later decided the additional information constituted a different application and disqualified it.

Walker alluded to a full-blown conspiracy against the Port Authority’s plan to build a gas pipeline from the North Slope to tidewater in Valdez for export by LNG tankers to outside receiving terminals, saying the Port Authority would not allow its disqualification to stand due to  “wrong-doing by the companies that did not want us to submit a bid.”

 

Walker alluded to “tremendous outside pressures” noted by other entities that had considered building all-Alaska natural gas pipeline plans in the past, but did not state whether or not the two companies that pulled out of their agreements with the Port Authority or other – also as yet unnamed companies - were those he is accusing of wrong-doing.  

He did say the Port Authority was reviewing its options in view of the state’s rejection.

“I can’t get any more specific today,” he said.

Members of the Port Authority, comprised of members appointed by the Fairbanks North Star Borough and the City of Valdez, will be meeting on Wednesday, January 9 to discuss where to go from here.

“We’re going to get back in the game,” said Walker, “It wasn’t anything the Port Authority did wrong.”