Alaska Lawmakers Question Gas Line's Economics

In addition, Palin has called for an in-state small diameter line to deliver North Slope natural gas to urban Alaska markets.

Palin and her administration defended the state process in news releases and a press conference ahead of the measure's first hearing Thursday.

The state should be vigilant, Palin said, "but I don't believe this resolution is necessary, and I certainly don't agree that there should be an AGIA 'redo.'"

"AGIA is a contract. Why would we take it off the table, especially in this economy and at a time of great need for energy independence?" she added.

Because, Ramras argues, a "plate tectonics" shift is under way in the energy world.

The global recession, combined with the new sources of natural gas, are creating surpluses in the Lower 48 that could depress prices for years to come, and possibly stall the Alaska project.

"Only a government is capable of going on autopilot and staying put. In the private sector, we revisit," Ramras said.