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Say What? The smoke clears on AGIA Lite

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After Monday's press conference, one would think with the circus atmosphere that the bullet line unveiled by Governor Sarah Palin, ANGDA and Enstar would be turning dirt and laying steel pipe by this weekend.

But apparently there is more to the story. Or much less to the story; depending on your view of the post press conference chatter.

In Tuesday's Anchorage Daily News, reporter Wesley Loy wrote, "The state will partner with Enstar Natural Gas Co. to build a pipeline to carry gas through the state's midsection."

However Governor Palin back tracked on Tuesday. With local talk show host Eddie Burke and guest Scott Heyworth from ANGDA debating the extent of the partnership, Palin called in to say that the Daily News was wrong to assert that the state had created a partnership with Enstar.

So where would ADN reporter Wesley Loy get such an outrageous idea?

Maybe it was the governor's press release that stated:

"Governor Sarah Palin today announced the formation of a public/private partnership among the Alaska Natural Gas Development Authority (ANGDA), ENSTAR Natural Gas Company, and the State of Alaska that will build the first phase of a bullet line to bring Alaska gas to Alaskans within the next five years."

Or maybe it could have been Palin's own words at the press conference when she proclaimed:

"We're announcing the formation of a project development venture. A public/private partnership that brings together a proven operator and a state entity and the authority and energy of this administration."

This is what happens when you try to create public policy by press conference.  

This was a press conference that was hastily thrown together without any thought and without any ability to offer answers to critical questions that the Palin administration had to know would be asked.

For instance the governor stood up and promised to be constructing the line by 2011, but then couldn't answer a simple question such as where the gas was coming from. After years of warning Alaskans about the diminishing supplies of gas in Cook Inlet; the governor didn't even bother to call Cook Inlet gas producers to ask them about exploration potential if the line were to be built. But yet she stood up and promised Alaskans a pipeline within five years. 

This was a press conference designed to quiet fears of lawmakers who have raised questions about AGIA's constraints on the state's ability to build an in state gas line just days before they vote on awarding an AGIA license to TransCanada.

And what about the partnership?

In fact their isn't one scrap of paper in existence that defines a partnership, working agreement or even a casual recognition between Enstar and ANGDA.

And why should there be?

This is what ANGDA Board Chair Scott Heyworth posted on our website today in response to a column by Fairbanks Daily News Miner columnist Dermot Cole questioning the proposed route:

"No wonder they ran to ANGDA to become part of the easily permitabe route (State and Feds) up the Glenn/Richardson. They saw the train leaving the station. And they didn't have a ticket. ANGDA certainly does not need Enstar for anything at all. They come to this new Palin Party with NOTHING. ANGDA doesn'tt need Enstar for anything at all. NOTHING. Enstar is in huge trouble. Bank it."

Oh yeah....this sounds like a real solid partnership.

http://www.andrewhalcro.com/what_others_are_saying_0#comment-2766 

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Does Sarah Palin think we are all DOLTS?

Submitted by Disgusted with Palin. (not verified) on Wed, 2008-07-09 20:13.

Criminy.....her backtracking is just UNBELIEVABLE! We all heard what we heard, her statements were recorded and then she says that ADN was "wrong to assert......." SIGH.....she is just unbelievable. She fudges the truth every day and she thinks we don't notice the inconsistencies???? Give me a break. the tide is turning...people ARE catching on to her....... She really is not very smart if she believes we all are believing her lies.

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Andrew Blog

Submitted by Tom (not verified) on Wed, 2008-07-09 09:33.

Andrew, I don't want you to become governor because then you might stop blogging. - Tom

Andrew's response:

That's okay because I don't want to stop blogging for fear I might do something crazy like run for office again.

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The Smoking Gun, or at least the Shotgun Wedding

Submitted by Anonymous (not verified) on Wed, 2008-07-09 07:43.

Heyworth seems to be the only smoking mouth piece here who is telling the truth. He just doesn't reach the same conclusion everyone else does. 1)"ANGDA certainly does not need Enstar for anything at all. They come to this new Palin Party with NOTHING." 2)"It is a bit of a shotgun wedding." 3)"We were both thrown togehter very abruptly last week for the good of Alaskans." 4)"We don't hardly even know each other yet." 5)"Yesterday was Day #1." 6)"It may or may not work out." Let's see here, a three-plus billion dollar project partnership announced by the governor and the partners "...don't hardly even know each other yet." It doesn't take much analysis to figure out this charade is nothing more than Palinista press conference politics. The agrieved party is ENSTAR. They were the hero of the hour and upstaging the increasingly precarious posturing of the administration. Sadly, ENSTAR has now clearly been intimidated into cooperation in some smoke filled back room with bright lights and rubber hoses. It's right out of a 1930's movie plot. Those classics never lose their relevance.

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Heyworth responds

Submitted by Anonymous (not verified) on Wed, 2008-07-09 08:43.

The Governor did not announce a Partnership. She did not force a shotgun wedding. She announced a potential "joint venture" of ANGDA and Enstar to pursue the potential and possibility of a "partnership and a project". Supported by and back stopped by her Administration. She announced her preferred route as the Glenn/Richardson. That's it folks. Pretty dang simple. Will it work? No one knows yet. Today is Day #3 of her proposal. ANGDA and Enstar are both in Juneau today for the continuing AGIA gas line hearings. We are now going to take a while to investigate the legalities, possibilities, and advantages of forming a new "Private/Public" entity to see if we can all accelerate and enhance this line all the way to Fairbanks. In that effort, the 2 Parties "will get to know" each other. It's just business, not incompetence. It's a vision. And it may or may not happen. Let us go to work to see if something can emerge to help Alaskans connect to their natural gas quickly. Neither Party is slowing down their own ongoing works. ANGDA for instance is hard at work aggregating the electrical utilities, getting ready for our own in-State "open season", working the propane for Rural Alaska possibilities, and aggresively pursuing in-State value-added industries with the gas liquids. Among a zillion other things we are doing for Alaskans. I have no doubt Enstar is staying very busy with their own pursuits also. There is no partnership yet. We are simply exploring the idea the Governor put forward. It can't possibly hurt to explore it. And there certainly was never a smoke filled back room with bright lights and rubber hoses. That is ridiculous.

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Uh, what?

Submitted by Super Dave (not verified) on Wed, 2008-07-09 10:53.

Look, I understand we Alaskans created a state agency by ballot measure, and I understand that ANGDA needs to, on a daily basis, remind the public that they're doing something, but usually when you have a degree in communications,like the good Gov does, you have a pretty good understanding what words mean. So, if you're going to have a press release and print,"Governor Sarah Palin today announced the formation of a public/private partnership among the Alaska Natural Gas Development Authority (ANGDA), ENSTAR Natural Gas Company, and the State of Alaska that will build the first phase of a bullet line to bring Alaska gas to Alaskans within the next five years" you seem to imply that indeed a partnership exsists. And by the way, if you're going to build a partnership that the leader of the state says exsists but you deny, then should the state partner with ENSTAR when they "ANGDA certainly does not need Enstar for anything at all. They come to this new Palin Party with NOTHING. ANGDA doesn'tt need Enstar for anything at all. NOTHING. Enstar is in huge trouble. Bank it" at all? You tell me, genius, since I hope you have time at work, to explain this to us folks in the sticks what's going on...

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Andrew, perhaps you can also

Submitted by Anonymous (not verified) on Wed, 2008-07-09 06:19.

Andrew, perhaps you can also answer this question: what role would FERC play in this line, and how might that impact the plans and timing? Wouldn't FERC have a hand in agreeing to tarrifs and ensuring open access?

Andrew's response:

An in state gas pipeline would be regulated by the Regulatory Commission of Alaska (RCA). FERC would play no role in establishing the tariffs or ensuring open access.

 

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A few questions.

Submitted by GlenBiegel (not verified) on Wed, 2008-07-09 03:30.

Andrew, This new public/private partnership has me puzzled. Can you help me with a few questions? Is it possible for us to get a pipeline started by 2011? Wouldn't we need to know for sure there is gas in the Inlet? Do people know this and they aren't telling us? When Heyworth says that ENSTAR doesn't bring anything to the table, does that mean the $3.3 billion is already on its way from the State? For the sake of argument, if we grant that there is a bunch of gas in the Inlet, wouldn it be better for ENSTAR to partner in the line and operate it as this agreement indicates? Thanks Glen

Andrew's Response:

Glen, from what I heard at the press conference and what I've heard afterward it seems nobody has any real answers to the key questions like; who finances the line, does the state contribute to the cost, where the gas is coming from or even the route.

I understand Enstar wanted to go the Parks Hwy route because it would touch on the population centers and have the best opportunity to reach more customers.

The question of gas in the Inlet is tricky because of the economics. A large find in theory could fill the pipe, but it is highly speculative and ignores the growing future demands that southcentral will have in the coming decades.

My biggest surprise from Monday's press conference was when  Marty Rutherford stated that they hadn't even picked up the phone to call Conoco or Marathon (the Cook Inlet producers) to ask about the likelihood of future exploration if a pipeline was to be built. This seems like the first thing you'd do when having a press conference  announcing that construction will begin in a little more than two years.

As far as 2011 to start turning dirt, I think that is a real stretch. I was told you'd need at least 3tcf of gas to make this thing pencil out. Enstar has been working with Anadarko's developments in the Foot Hills to procure gas for their original pipeline plans but I hear the process is slow and they still don't have any gas samples to judge the quality of the gas.

I'm not a petroleum engineer, but what I understand is depending on the quality of gas that comes out of the ground, they may need to invest another billion or so in a gas treatment plant.

 

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