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  • Post Discovers Palin's Pipeline

    Energy consistently ranks among the top three issues Americans care most about this year. So when Sarah Palin burst onto the national scene, the first thing we did was analyze her record on the issue. The mainstream media, however, seemed mostly interested in attacking Palin’s personal life. But slowly they are returning to cover the public policy issues at stake. Today The Washington Post takes a look at Palin’s efforts to build a natural gas pipeline in Alaska:

    Ms. Palin is indeed correct about the need to tap the 35 trillion cubic feet of natural gas under Alaska’s North Slope … Yet for decades the idea has been deadlocked by federal and state politics — and unless the United States can install a pipeline to transport Alaska’s gas soon, companies may commit to foreign sources of liquefied natural gas, thus locking in long-term dependency on imports.

    Ms. Palin’s predecessor as governor, Republican Frank H. Murkowski, attempted to negotiate a deal with the three oil companies that control the North Slope gas, Exxon Mobil, BP and Conoco Phillips. His plan would have awarded the companies a long-term tax freeze in return for relatively weak commitments to actually build the pipeline. But even though Vice President Cheney and Sen. Ted Stevens (R-Alaska) lobbied hard for Mr. Murkowski’s approach, Alaska’s public and legislature balked, viewing the proposal as stacked in favor of the Big Three oil companies. Ms. Palin rode criticism of Mr. Murkowski’s deal to victory over him in the 2006 Republican gubernatorial primary and then to the governor’s office later that year. She reversed Mr. Murkowski’s strategy, asking the legislature to pass a law setting criteria for a deal, then throwing the project open to companies other than the Big Three. The result was a commitment by an experienced pipeline company, TransCanada, to build the project, which may take 10 years, in return for $500 million in state seed money derived from Alaska’s recent oil windfall.

    The oil companies still control the gas. So, if TransCanada actually gets all the necessary permits, assembles financing and builds the pipeline, the Big Three will have to be persuaded, years from now, to ship their gas through it on reasonable terms. Meanwhile, BP and Conoco Phillips have announced plans to build a pipeline of their own without the state’s backing — a sign that the political and economic wrangling over this immense and risky project is far from over. But it is also a sign that Ms. Palin’s outflanking of the oil companies injected some competition and urgency into a process that was previously stalled. Perhaps her Democratic opponent for the governorship in 2006, who campaigned on similar ideas, would have achieved these results. Nevertheless, Ms. Palin actually did.

    Posted in Energy [slideshow_deploy]

    2 Responses to Post Discovers Palin's Pipeline

    1. markg8 USA says:

      Mrs. Palin gave a Canadian pipeline company half a trillion dollars for a natural gas pipeline to Alberta where it'll be used to refine tar sands into oil if it ever gets built. Three American oil companies own the natural gas and they plan on building their own pipeline without her $500 pork subsidy so it's unlikely TransCanada will get the rest of the financing to build theirs. In any event neither pipeline will be finished for another 10 years at which time cleaner, cheaper alternatives should crowd fossil fuels out of the market. Bad bets on backward thinking 20th century technologies shouldn't be encouraged or rewarded.

    2. Pingback: » Post Discovers Palin’s Pipeline » Exxon Mobil

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