For Immediate Release: March 17th, 2014
Senator French: “Why TransCanada?”
New reports raise red flags, call into question economic benefits of TransCanada partnership
JUNEAU – Recently released reports from independent legislative consultants indicate that a potential partnership between the state of Alaska and TransCanada could have significant and negative long-term economic impacts on the State.
“Independent consultants have presented substantive, data-backed arguments indicating a partnership between TransCanada and the state of Alaska could cost Alaskan families who burn natural gas to heat their homes hundreds of dollars per year,” stated Senator Hollis French (D-Anchorage).
Administration presentations have leaned on TransCanada’s expertise as a pipeline owner and operator, yet as consultant Roger Marks points out in his recent report, “the expertise to build and operate the facilities comes largely with the producers’ involvement.” (Marks, Pg 12)
Mr. Marks suggests the state should solicit bids, if a partnership concept is indeed the best economic and operational model for the state moving forward, stating:
“If the enabling legislation is enacted, the state will essentially be giving TC a sole-source contract worth tens of billions of dollars to transport the state’s gas.” (Marks, Pg 11)
Another analysis, by Enalytica, suggests TransCanada’s involvement could cost the state upwards of $500 million per year in cash flow, versus a scenario in which the state proceeded as a partner in the LNG project alone. Furthermore, in the same analysis a stress test case scenario found the only situation in which Alaska could experience annual negative cash flow is by partnering with TransCanada. (Enalytica, Pgs 1-2)
“These reports raise considerable questions about the administration’s proposal to enter a long-term business deal with TransCanada. As legislators our obligation is to enable and negotiate the best business deal for the citizens of Alaska. We all want a gasline, but a sole-source contract that could potentially cost Alaska tens of billions of dollars and runs in the red every year is not a good business deal for the State,” said Senator French.
To view the report from Roger Marks, click here:
To view the memorandum from Enalytica, click here:
For more information contact Senator French at (907) 465-3892.