Murkowski Seeks $30 Billion Loan Guarantee To Construct Alaska Gas Pipeline to Lower 48

The Senate Energy and Natural Resources Committee is expected to approve June 9 an oil and gas title to a draft energy bill that will increase a federal loan guarantee for building the Alaska natural gas pipeline from $18 billion to $30 billion.

 

Sen. Lisa Murkowski (R-Ala.), ranking minority member, said Senate Energy Chairman Jeff Bingaman (D-N.M.) has agreed to include the increased authorization in the base text of an energy bill that the committee hopes to complete the week of June 9.

 

The pipeline, long sought by the state of Alaska, would deliver huge reserves of Alaska natural gas into Lower 48 markets. Much of the gas is located on state lands and would be a great boon to the Alaskan economy.

 

“A gas line is absolutely essential for Alaska's economic future,” Murkowski said.

 

“These guarantees will ensure that the largest construction project in North America is able to move forward despite the current economic uncertainties,” she said.

 

Murkowski's amendment also would authorize access to the Federal Financing Bank, an entity within the Treasury Department that finances federal programs, to reduce interest rates and administrative costs “by hundreds of millions of dollars.”

 

Murkowski said the provisions are “applicant neutral and beneficial” to Alaska's efforts to get a natural gas pipeline regardless of whether the TransCanada project or the Denali project—the two leading proposals—are ultimately successful.

 

Offshore Amendments Expected.

 

The committee also is expected to take up the subject of offshore drilling.

 

The base bill includes an inventory of marine resources but does not call for opening new offshore areas to exploration.

 

The oil and gas industry would like to see the lifting of remaining moratoria on the eastern Gulf of Mexico, assurances that the federal offshore leasing schedule will not be interrupted, and more revenue sharing with coastal states that support offshore exploration.