Deep budget cut
Deep budget cut
Federal coordinator for Alaska gas line forced to reduce expenses, staff
Wesley Loy
For Petroleum News
Congressional budget cutters have come down hard on the small federal agency created to expedite permitting and construction of an Alaska natural gas pipeline.
In the consolidated appropriations act, H.R. 2055, that President Obama signed Dec. 23, the coordinators office received $1 million for fiscal year 2012, which runs through next September.
The agency received about $4 million in each of the two preceding budget years, Larry Persily, the federal coordinator, told Petroleum News.
It means Persily now must take steps to cut the agencys expenses and its 11-person staff, which is split between Washington, D.C., and Anchorage.
No one will be laid off immediately, but Persily said hell make staffing decisions in the next couple of weeks.
The cuts will hurt, but Persily said he has a plan for keeping the agency on track with its work in coming years.
Waiting for a project
Congress created the coordinators office with the Alaska Natural Gas Pipeline Act of 2004.Its job is to work with numerous federal agencies, as well as the state, the Canadian federal government and tribal governments to smooth the road toward an Alaska North Slope gas pipeline.
Since its creation, the coordinators office has been waiting to really swing into action on a firm pipeline project.
While one project proposed by a partnership of TransCanada and ExxonMobil remains on the table, the Denali project teaming BP and ConocoPhillips has faded away.
With natural gas prices running relatively low, and an explosion of shale gas coming into the market, prospects for a multibillion-dollar Alaska gas line seem to have dimmed recently.
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The coordinator's office could become increasingly busy, assuming TransCanada and ExxonMobil stay on track to submit a project application in October 2012 to the Federal Energy Regulatory Commission, Persily said. Assuming the application is complete,
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