A commission appointed by the governor of Alaska yesterday recommended building a $25.2 billion pipeline to transport the state's abundant natural gas to terminals on its southern coast, where the gas would be converted into liquefied natural gas and shipped to Japan.
The report of the committee chaired by former Alaska governors Walter J. Hickel and William A. Egan recommended the all-Alaska pipeline as an alternative to the Alaska Natural Gas Transportation System (ANGST), a project designed to moved the gas to Canada and the United States.
The $43 billion ANGST project, which had received support from President Jimmy Carter and from Congress, has been stalled indefinitely by an inability to arrange financing and a weaker natural gas market in the United States than anticipated.
According to the committee appointed last June by Gov. Jay Hammond, the Far East provides a far better market for Alaska's natural gas than the United States. That and lower construction costs argue in favor of the proposal, the report said.
"Prospects of available Canadian and Mexican gas . . . as well as less expensive production from a large number of shut-in U.S. wells, leads the committee to conclude that North Slope gas does not have a ready market in the United States in the near term," according to the report.
But John McMillian, chairman and chief executive officer of the Northwest Alaskan Pipeline Co., the operating partner for ANGST, said the proposal "does not provide any meaningful solutions" to Alaska's natural gas marketing problem.
The committee recommended presidential and congressional action to smooth the project's course if Hammond adopts the recommendation. Otherwise, legal roadblocks might delay it, the report said.