Alaska Lawmakers Question Gas Line's Economics

By ANNE SUTTON

JUNEAU, Alaska (AP) — Alaska's decades-long efforts to build a natural gas pipeline to deliver gas to the Lower 48 looks better than ever.

Or worse than ever.

State lawmakers brought back mixed messages from an energy conference in Washington, D.C., where the merits of a proposed Alaska pipeline — Gov. Sarah Palin's hallmark project — were viewed against increased competition from both shale and liquefied natural gas.

And before a shovel has even been put into the ground for the pipeline, some lawmakers are having second thoughts about giving Calgary-based TransCanada Corp. up to a half-billion dollars to get the estimated $30 billion project moving.

With the global recession and Alaska's state coffers dwindling with the low price of oil, state Rep. Jay Ramras, R-Fairbanks, has co-sponsored a resolution asking the Palin administration to revisit the generous financial terms for what some call an uncertain project at best.

The Canadian company won an exclusive state license to build the pipeline under the Alaska Gasline Inducement Act, and with it up to $500 million in state incentives. Another company, formed by ConocoPhillips and BP PLC, is proposing its own pipeline without the incentives.